We talk to the firm about why it created the multi-family office, the case for the move in the present environment, and more.
Simon Hopkins (pictured), the founder and group CEO of Milltrust International [Group], says he’s quick to pivot a business to capture new opportunities and pull back from areas when markets have shifted.
A newly-launched multi-family office business looks like a case in point.
In 2023, Milltrust launched East West Private Wealth (EWPW), and this January it appointed former senior banker Edward Higgins as managing director, based in Singapore.
The MFO offers investment opportunities including venture capital, liquid public equity funds, and direct impact-driven co-investments, in addition to real assets investments. It also uses Milltrust International’s internal asset management capabilities, such as the British Innovation Fund II, the Climate Impact Asia Fund, and the Global Emerging Markets Fund, along with its suite of emerging market public equity country funds, venture [funds] and real assets funds. EWPW is already banking clients in jurisdictions such asin Geneva, Monaco, and the United Arab Emirates in addition to its London and Singapore offices.
The rapid rise of Singapore as a wealth management centre – exceeding $6 trillion of assets under custody of banks – has been a “stunning development” and in some ways the Asian city-state has eclipsed Switzerland, Hopkins said in an interview. But, as yet, Singapore hasn’t bred a large, standalone, domestic asset management business of the sort to rival the big US and European houses, Hopkin said.
And there’s plenty of need for the kind of wealth management business able to give HNW clients a full set of options, he said.
“I would have thought there would be more visionary players shifting asset management capability to Singapore and more domestic champions,” Hopkins said. “You are looking for people to get out there and scour the landscape and find the best solutions [out there].”
“This is my `Road to Damascus’ moment,” Hopkins, who has been a player in areas such as emerging markets and sustainable agriculture, among others, said. “We have within our organisation the capability to put together highly professionalised investment portfolios.”
Change of focus
In recent years Hopkins focused much of his energy on areas such as emerging markets, and sustainable agriculture. He’s been willing to change tack when needed. For example, in November 2021 Milltrust sold its UK subsidiary, Milltrust Agricultural Investments, to Future Planet Capital, a UK venture capital group.
“Over the last decade or more, since setting up the [business] framework in Singapore, we’ve become a solutions provider. The way I’ve built my business is with an eye on what is the best opportunity for investors within any discrete timeframe,” Hopkins said. There have been developments which Hopkins admitted he did not fully anticipate, such as the slowdown in Chinese growth and the policies of the Beijing regime. To take a different example, the stronger economic growth of emerging markets has not been fully reflected in stock markets by and large. The only possible exception to this situation is in India, where stocks have outperformed the US S&P 500.
Multi-family office drive
The new MFO is part of the way in which the business seeks to surf a wave of wealth and provide solutions.
“[It] is a Singapore-incorporated company but a global family office…it has operations in London and the UAE…we are creating a regulated subsidiary in Abu Dhabi,” he said, enthusing about the growth of wealth in the Gulf and the attractions of such places to “global nomads.” The UAE, like Singapore, benefits from perceptions of being stable, secure places, important qualities in present times.
Another force at work behind his MFO is disenchantment with what private banks have to offer clients, Hopkins said.
“People are leaving private banking platforms, disgruntled with the offerings of private banks,” he said. Part of the challenge for banks is that they labour under regulatory/compliance constraints that get in the way of helping clients, he continued.
To some extent the growth of external asset managers (EAMs) in Singapore and the wider APAC region – mirroring to some extent the Swiss EAM market – is part of this. This news service has chronicled the growth of Asia EAMs.
Singapore has bottlenecks – and that also creates openings for those able to tackle them.
“There could be more inflow [of wealth] to Singapore if you had more people to facilitate the compliance function,” Hopkins said. Singapore is an expensive city, so a good deal of the necessary work to enable movement of money doesn’t have to be performed there, he said.
This news service asked Hopkins about how hundreds (estimated to be about 700) of single-family offices are registered in Singapore. He said one driver is that having a family office equates to a kind of residency-by-investment move, given the ways Singapore requires residents to deploy part of their capital into the jurisdiction.
And there are new jurisdictions to keep on the radar, Hopkins concluded. In India, the government is constructing the Gujarat International Finance Tec-City (GIFT City), a financial services hub with its own tax rules and structures that could, for example, compete with offshore centres such as Mauritius. The success of Dubai, Singapore and other hubs' growth hasn’t been lost on India – the opportunities are large, Hopkins added.
Handy Facts About Multi-Family Offices and
-- Several high-profile people have created single-family offices in Singapore, such as Google co-founder Sergey Brin, the former CEO of Fosun International Liang Xinjun, and chairman of Reliance Industries Mukesh Ambani.
-- About 59 per cent of Asian family offices are in Singapore, according to KPMG.
-- At the end of 2022, there were 1,500 family offices in Singapore, overseeing around S$90 billion ($66.8 billion) worth of assets. This is just under two percent of the S$5.4 trillion of assets managed in Singapore (source: ASEAN Briefing). Data varies: there’s some debate on what Singapore counts as a “family office”.
-- Since 2020, the jurisdiction has also operated a variable capital company (VCC) regime to encourage wealth management business, and it is looking at an updated VCC programme to help SFOs.
-- Singapore has competition: In June 2023, the government in Hong Kong has unveiled its “Network of Family Office Service Providers” as it gears up to attract family offices into the jurisdiction.
-- Also last June, DBS launched the DBS Multi Family Office Foundry VCC. DBS said this was the world’s first bank-backed multi-family office that uses the jurisdiction’s Variable Capital Company structure which was introduced in early 2020.
-- The Highworth Research database is a useful resource on SFOs
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