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Press Release

Assets of world’s largest fund managers passes US$80 trillion for the first time

AuM of China fund managers surpasses US$1 trillion in the global 500

October 30, 2017

Total assets under management (AuM) of the world’s largest 500 managers grew to US$81.2 trillion in 2016, up 5.8% on the previous year, according to latest figures from Willis Towers Watson’s Global 500 research.

Hong Kong, 30 October 2017 – Total assets under management (AuM) of the world's largest 500 managers grew to US$81.2 trillion in 2016, up 5.8% on the previous year, according to latest figures from Willis Towers Watson's Global 500 research.

The research, which takes into account data up to the end of 2016, shows that AuM for Asia Pacific managers in the global ranking totalled US$6.9 trillion, up 1.3% on the year. Japan at US$4.7 trillion, represents the largest share of the assets managed by managers domiciled in Asia Pacific, followed by Australia with US$1.1 trillion. Assets managed by 21 mainland Chinese managers amounted to approximately US$1.1 trillion in 2016, which would rise to US$1.2 trillion if the AuM of four Hong Kong managers (US$123 billion) is included.

The research also shows that during the five-year period from end-2015 to end-2016, there was an increase in the representation of managers from mainland China (from 0.3% in 2011 to 1.3% in 2016) among the top 500 managers. In contrast, the representation of managers from Japan declined during this period from 8.4% in 2011 to 4.6% in 2016. The share of total assets managed by Australia and South Korea managers has been relatively stable during the period.

Harvest Fund Management (ranked 109) is the largest among the 21 mainland Chinese managers who responded for the survey, followed by China Asset Management (ranked 123) and CCB Principal Asset Management (ranked 153).

Richard Tan, Head of Manager Research for Asia at Willis Towers Watson, said: "Given the scale of the retail and private wealth sectors in mainland China, we believe the expanding population of middle- and higher-income individuals still offers the potential for stronger asset gth for managers in China. The institutional space has also experienced fast-ging demand for third-party asset managers to manage a portion of assets outsourced by Chinese institutions, largely benefiting established local players and those affiliated with financial institutions."

The research found that AuM for North American managers increased by 7.7% over the same period and now stands at US$47.4 trillion, while assets managed by European managers, including the UK, increased by 2.8% to US$25.8 trillion. However, UK-based firms saw AuM decline for the second consecutive year, falling by 4.5% in 2016 to US$6.3 trillion.

Although the majority of total assets (78.4%) are still managed actively, its share has declined from 79.7% from end of last year as passive management continues to make inroads.

Richard Tan said: "It is encouraging to see a return to gth in total global assets, suggesting that managers are finding success in attracting investors towards innovative solutions to achieve superior risk-adjusted returns. While passive assets remain significantly smaller than actively managed assets, the proportion of passively managed assets has gn from 16.5% to 21.6% over the last five years alone. We expect this trend will continue to put downward pressure on traditional fee structures, particularly among active managers seeking to remain competitive and to maximise value to investors."

The 20 largest asset managers experienced a 6.7% increase in AuM, which now stands at US$34.3 trillion, compared to US$26.0 trillion ten years ago. The share of total assets managed by this group of 20 largest managers increased for the third year in a , rising from 41.9% in 2015 to 42.3% by the end of 2016. Despite this, the bottom 250 managers experienced a superior gth rate in assets managed, rising by 7.3% over the year.

As with previous years, equity and fixed income assets have continued to dominate, with a 78.7% share of total assets (44.3% equity, 34.4% fixed income), experiencing an increase of 3% combined during 2016. Continuing from the strong gth they experienced in 2015, assets in alternatives saw a 5.1% increase by the end of 2016, closely followed by equities at 4.1%.

Richard Tan said: "Alternatives continue to g in popularity, with investors remaining under pressure to find effective means of diversification in an environment of lower expected returns from traditional asset classes. These strategies often come with greater complexity and require superior risk management. We see this as linked to the gth in assets managed by managers in the bottom half of our list, suggesting that investors favour smaller investment houses with specialist investment skills."

Richard Tan added: "Our research has highlighted awareness in sustainable investing, with 78% of the firms surveyed acknowledging a ging interest from their clients for these sorts of strategies as they continue to look for ways to add value for clients."

While BlackRock retains its position at the top of the manager rankings for the eighth consecutive year, further insight shows the main gainers, by rank, in the top 50 during the past five years. These include: Dimensional Fund Advisors (+31 [76 to 45]); Affiliated Managers Group (+20 [52 to 32]); Nuveen (+16 [36 to 20]); New York Life Investments (+15 [55 to 40]); and Schroder Investment Management, (+15 [59 to 44]).

The world's largest money managers

Ranked by total assets under management, in U.S. millions, as of Dec. 31, 2016

Global Rank Manager Market Assets
1 BlackRock U.S. $5,147,852
2 Vanguard Group U.S. $3,965,018
3 State Street Global U.S. $2,468,456
4 Fidelity Investments U.S. $2,130,798
5 Allianz Group Germany $1,971,211
6 J.P. Morgan Chase U.S. $1,770,867
7 Bank of New York Mellon U.S. $1,647,990
8 AXA Group France $1,505,537
9 Capital Group U.S. $1,478,523
10 Goldman Sachs Group U.S. $1,379,000
11 Prudential Financial U.S. $1,263,765
12 BNP Paribas France $1,215,482
13 UBS Switzerland $1,208,275
14 Deutsche Bank Germany $1,190,523
15 Amundi France $1,141,000
16 Legal & General Group U.K. $1,099,919
17 Wellington Mgmt. U.S. $979,210
18 Northern Trust Asset Mgmt. U.S. $942,452
19 Wells Fargo U.S. $936,900
20 Nuveen U.S. $881,748

Source: P&I/Willis Towers Watson World 500

The top 20 largest money managers domiciled in Asia Pacific

Ranked by total assets under management, in U.S. millions, as of Dec. 31, 2016

Global Rank Manager Market Assets
31 Sumitomo Mitsui Trust Holdings Japan $699,484
36 Nippon Life Insurance Japan $647,484
39 Mitsubishi UFJ Financial Group Japan $584,765
52 Macquarie Group Australia $362,511
57 Meiji Yasuda Life Insurance* Japan $306,716
61 Shinkin Central Bank* Japan $296,976
62 Nomura Asset Mgmt. Japan $295,943
78 Sumitomo Life Insurance* Japan $221,963
92 Samsung Group South Korea $180,206
102 Colonial First State Australia $147,154
106 Resona Holdings Japan $139,687
109 Harvest Fund Mgmt. Mainland China $136,221
112 Nikko Asset Mgmt. Japan $133,349
120 AMP Capital Australia $119,476
123 China Asset Mgmt. Mainland China $115,367
126 Mizuho Financial Group Japan $109,690
146 Mirae Asset Financial Group South Korea $87,404
152 Pacific Century Group Hong Kong $82,700
153 CCB Principal Asset Mgmt. Mainland China $82,668
160 Hanwha Group South Korea $77,835

Source: P&I/Willis Towers Watson World 500

* As of March 31, 2016

Distribution of assets by market in Asia Pacific

Ranked by total assets under management in U.S.$ millions, as of Dec. 31, 2016

Market Number of managers
in the global ranking
Assets Share of the
global 500
Japan 18 $3,748,303 4.6%
Australia 21 $1,124,563 1.4%
Mainland China 21 $1,065,043 1.3%
South Korea 19 $684,000 0.8%
India 7 $148,423 0.2%
Hong Kong 4 $122,663 0.2%
TOTAL 90 $6,892,995 8.5%

Source: P&I/Willis Towers Watson World 500

About Willis Towers Watson Investments

Willis Towers Watson’s Investments business is focused on creating financial value for institutional investors through its expertise in risk assessment, strategic asset allocation, fiduciary management and investment manager selection. It has over 900 colleagues worldwide, assets under advisory of over US$2.3 trillion and over US$87 billion of assets under management.

About Willis Towers Watson

Willis Towers Watson (NASDAQ: WLTW) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for gth. With roots dating to 1828, Willis Towers Watson has 40,000 employees serving more than 140 countries. We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our unique perspective allows us to see the critical intersections between talent, assets and ideas – the dynamic formula that drives business performance. Together, we unlock potential.

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