Singapore’s financial regulator and central bank is looking at how to place family offices on a legal footing - hopefully with the result of boosting this still-underdeveloped segment in the Asia region.

Singapore’s financial regulator and central bank is looking at how to place family offices on a legal footing, according to AsianInvestor. The publication said the MAS worked on ideas for about three years, examining rules and guidance for single family offices.

The Monetary Authority of Singapore, however, insisted, when asked by this publication, that it is not working on specific rules for family offices, contrary to what AsianInvestor's sources said. "All persons who manage funds for a customer, regardless of the amount, are considered to be carrying out fund management, which is a regulated activity. Persons managing funds for related or connected persons may be exempted from licensing, subject to them meeting the exemption criteria. MAS is not working on any further regulatory proposals relating specifically to family offices."

A legal framework for family offices could boost the sector, the report said. The jurisdiction’s Economic Development Board has been promoting the city-state as a place to establish single family offices.

It has been noted for some time that while Asia is one of the fastest growing regions in the world in terms of its population of ultra high net worth individuals, in proportionate terms it lags behind the US and Western Europe in its family office sector. This disparity is seen as particularly anomalous as so many Asian business empires are family-owned.

The total SFO sector around the world is made up of about 3,000 of these institutions, already a well established market in North America and to some extent, in Europe. In Asia, by contrast, the sector is akin to a young teenager – at least half of the SFOs have been created only within the last 15 years. The region so far accounts for a relatively tiny 3 per cent of all the world’s single family offices – or around 100, according to a recent report by Credit Suisse, Ernst & Young and the University of St Gallen, Switzerland.

In recent years, the US has tightened definitions of what a family office is, requiring those bodies that manage assets for non-family members to be brought under the oversight of the regulatory authorities. One consequence has been that some investment tycoons, such as George Soros, have reinvented their businesses as family offices, ceasing to manage non-family money.