The bright prospects of Việt Nam's asset management industry

Services for VPBank's priority customers. — Photo courtesy of VPBank

In the dynamic global economic landscape, the asset management sector is emerging as a standout field, with rapid growth fuelled by wealthy, middle-class and high-net-worth investors, transitioning towards professional asset management models and high-tech applications.

According to a 2023 Knight Frank report, Việt Nam boasts 19,400 US dollar millionaires, marking a 98 per cent increase over the past decade, which includes six billionaires and 58 inpiduals with over US$100 million in assets.

The robust development of the affluent and middle-class is driving demand for estate management services as inpiduals and family businesses focus on optimising assets and long-term financial planning.

McKinsey forecasts a 20 per cent annual market growth rate in this sector, with revenue projected to increase by 23 per cent annually over the next three years.

By 2027, the Vietnamese estate management market is expected to reach approximately $130 billion.

For highly liquid assets like stocks and bonds, the Assets Under Management (AUM) in Việt Nam has surged from VNĐ95 trillion ($4.5 billion) in 2014, to over VNĐ600 trillion ($25 billion) in 2023, equivalent to 5.7 per cent of GDP, according to the State Securities Commission of Việt Nam (SSC).

Compared to other markets in the region such as Thailand, Malaysia (30 - 40 per cent of GDP), or developed countries and regions like Taiwan (China), South Korea (60 - 67 per cent of GDP), Việt Nam still holds significant development potential.

The CEO of Thiên Việt Asset Management JSC, Trần Vinh Quang, said that the middle class is experiencing significant growth and the expected upgrade of the stock market will be a driving force propelling the asset management industry to reach remarkable heights in the coming decade.

Moreover, the increasing savings rate for investment from the middle-income investor group, reaching 10 - 12 per cent annually, is expanding opportunities for the market.

These factors provide a solid foundation for asset management companies in Việt Nam to develop comprehensive financial solutions, meet customer needs and enhance competitive capabilities in both regional and international markets.

The asset management sector in Asia is rapidly evolving, presenting significant opportunities for Việt Nam. Domestic clients prioritise sustainable financial solutions, reasonable risks and deep market understanding.

This scenario, both an opportunity and a challenge, demands enterprises to innovate, digitise and improve service quality to meet increasingly high expectations.

The future of Việt Nam's asset management industry will depend on continuous innovation and technology applications to address the perse needs of customers.