驾驭变革 拥抱增长

Navigating change and embracing growth kpmg.com/cn Welcome to the Hong Kong Trust Industry report, co-authored by the Hong Kong Trustees’ Association (HKTA)and KPMG China. Much has transpired since our last report in 2021. The global economy has faced significant challenges, from the lingering effects of the pandemic to geopolitical uncertainties and market volatility. Yet, amidst these headwinds, the Hong Kong trust and fiduciary industry has continued to grow, reflecting the strength of its regulatory framework, the diversity of its client base, and the adaptability of its practitioners. To gain insights into the changes that have shaped the industry over the past four years, we conducted in-depth interviews with nearly 30 senior industry executives alongside a digital survey of HKTA member institutions. Thanks to their input and insights, we not only have a clearer picture of the key trends, risks and opportunities of strategic interest to the Hong Kong trust industry, but we have also gained a deeper understanding of what will matter most as the industry strives to make progress over the next few years. The trust industry remains a crucial segment of Hong Kong’s financial services sector and there have been numerous changes to the industry and the broader financial services sector since the issuance of our previous report. Notably, the recent regulatory developments, such as the introduction of RA13 for depositaries of SFC-authorised collective investment schemes and the HKMA’s Supervisory Policy Manual Module TB-1, are enhancing industry credibility and investor protection. We also delve into the transformative potential of the eMPF Platform,which is poised to reshape Hong Kong’s pension system and bring changes to the landscape for pension trustees. Beyond these regulatory shifts, landmark initiatives within the broader financial sector are also impacting the trust industry. These include the launch of Wealth Management Connect 2.0, the growth of the family office sector, and the increasing popularity of alternative investments, such as virtual assets. While the industry has experienced growth, it also faces challenges. A growing talent shortage, rising regulatory compliance costs, and reduced investor appetite around ESG considerations are all key concerns. This report addresses these challenges head-on, providing insights and recommendations to help industry participants navigate the path ahead. We extend our sincere gratitude to all survey respondents and interviewees for their contributions to this report. Their insights and perspectives have been instrumental in shaping our understanding of this dynamic and evolving industry. Ka Shi Lau BBS, Chairman Head of Securities and Asset Management, Hong Kong KPMG China Hong Kong Trustees’ Association Hong Kong Trust Industry Spotlight 20253 We would like to thank the following individuals (in alphabetical order) and organisations for their generous contributions to our research, whether through interviews, written responses, or statistical data. While often operating outside the spotlight, Hong Kong’s trust and fiduciary industry plays a critical role in the city’s success as a major international financial centre. Corporate Trusts administrators for a wide range of investment products. These entities offer core services like trust setup and administration, ensuring the proper management and distribution of assets according to the trust’s terms. Their fiduciary responsibility is particularly crucial for safeguarding the interests of investors in both wholesale and retail investment products while adhering to stringent regulatory requirements. The growing retail fund sector is driving demand for corporate trust services with a 3% year-on-year growth in 2023 of SFC Type 9 licensed corporations(authorised for asset management activities). Since the introduction of the Mandatory Provident Fund (MPF) System in 2000, Hong Kong’s pension schemes have served as a cornerstone of retirement protection for the city’s workforce. Close to 100%of Hong Kong’s working population contributes to some form of retirement protection through MPF or ORSO (Occupational Retirement Schemes Ordinance) schemes. Data from the SFC’s 2023 Asset and Wealth Management Activities Survey reveals that pension funds continue to dominate as the largest asset category held under trusts, accounting for 38% of total managed assets. Private trusts cater to the growing number of wealthy individuals and families in Hong Kong, the Chinese Mainland, and the broader Asian region. This includes wealth and estate planning, succession planning, wealth management and family office services - a sector where the government has introduced a range of new incentives in recent years. Charitable trusts serve the burgeoning interest in philanthropy in Hong Kong. As of September 2024, the IRD recognised 10,699 charities as tax-exempt, including 441 charitable trusts. The sector continues to