HSBC Private Wealth Solutions has stayed in the top spot in the second annual ranking of the global family office sector by Bloomberg Markets.

HSBC Private Wealth Solutions, part of UK/Hong Kong-listed HSBC, has retained its title as the world’s number one family office business in terms of assets under advisement, according to the second annual ranking of the sector by Bloomberg Markets.

The ranking, which features in the September issue of Bloomberg Markets magazine, puts HSBC Private Wealth Solutions’ AuA figure at $123.6 billion, derived from 297 client families. Importantly, the business has grown its AuA by 21 per cent year-over-year, putting it in fifth place in terms of greatest year-over-year growth. In the 2011 ranking HSBC Private Wealth Solutions recorded $102 billion in assets under advisement.

The top ten

Turning back to the rest of the top five for 2012, Chicago-headquartered Northern Trust was ranked second, with an AuA figure of $90.0 billion and 4,101 client families, while BNY Mellon Wealth Management came third with $64.5 billion in AuA from 424 client families. Rounding out the top five were Bessemer Trust ($62.4 billion in AuA from 2,100 client families) and Geneva-based Pictet ($57.3 billion in AuA from fewer than 50 client families).

Just outside the top five was Switzerland’s UBS Global Family Office, which recorded £37.3 billion in AuA and 125 client families.

The rest of the top ten for 2012 was dominated by US firms, which ran as follows: Wilmington Trust, part of M&T Bank ($31.9 billion AuA, 306 families); Abbott Downing, part of Wells Fargo ($30.6 AuA, 597 families); Bank of America-owned US Trust ($29.6 billion AuA, 163 families); and PNC Financial-owned Hawthorn ($21.3 billion AuA, 550 families).

While HSBC Private Wealth Solutions had the top spot in both of the annual rankings, there was some reshuffling of the top ten between 2011 and 2012. For example, while Bessemer Trust now stands fourth in the rankings with $62.4 billion in AuA, last year it came in second place with $44.5 billion of AuM (its year-over-year growth rate was 1 per cent).

Some of the firms in Bloomberg Markets’ ranking of the family office sector showed some very impressive growth figures indeed, indicating just how aggressively institutions are chasing growing family wealth. As part of these moves, many firms, including the venerable Swiss houses, have developed teams to exploit the fast rise in the number of Asian ultra high net worth individuals – people who tend to derive their wealth entrepreneurially and are looking to pass family businesses on to future generations. The figures certainly vindicate this strategy: the latest World Wealth Report by RBC Wealth Management and Capgemini found that the number of millionaires in Asia rose by 1.6 percent to hit 3.37 million in 2011, meaning that the region surpassed North America (which had 3.35 million) for the first time.

Smaller firms: impressive year-over-year growth

Looking more closely at the growth rates of various family office businesses, Bloomberg Markets identified several standout firms, although it should be said that the majority of these were smaller institutions since it is easier to show dramatic growth from a lower asset base (it is also interesting to note that of the top 10 fastest-growing firms in the ranking, only one - HSBC Private Wealth Solutions - was part of a big bank). Number one for growth was Virginia-based Signature, which now has $3.6 billion in AuA – a figure which grew by an impressive 36 per cent between 2011 and 2012. Another fast-growing boutique (in second place for growth) was Missouri-headquartered Financial Management Partners, which reached $2.6 billion in AuA, representing a rise of 30 per cent from 2011.

Assets per family: a very different view

Bloomberg Markets also ranked the world’s family office businesses in terms of average assets per client family – yielding some very different results.

At number one was Geneva-based 1875 Finance, which has an AuA of $5.1 billion and just three client families, giving an average of £1.7 billion per family. Meanwhile, on an average assets per family basis, HSBC Private Wealth Solutions was ranked fifth globally, with each of its 297 client families bringing in $416 million in assets on average.

The rest of the top five on an assets per family basis ran: (2) McCutchen Group, with average assets of $1.3 billion; (3) Pictet, at $1.1 billion; and (5) TAG Associates, at $340 million.

While assets under management, and growth in assets, obviously only capture one aspect of a family office – its size – the figures allow firms to know their relative performance in the industry on this measure. Assets are also a gauge of purchasing power for a variety of wealth management products.