Hong Kong Chief Executive John Lee told a gathering of global bank and fund chiefs on Tuesday that assets managed in the city rose 20% last year to a record US$5.4 trillion, and he urged more family offices and fund managers to set up there while a bill widening their tax breaks sits with lawmakers.

The pitch matters for private banks, asset managers and wealthy families across Asia deciding where to book money. The government is leaning on hard numbers to make its case. Lee said net fund inflows nearly tripled last year to US$270 billion.

Hong Kong wealth management numbers behind the claim

Lee spoke at the fifth Global Financial Leaders' Investment Summit, which he said drew about 280 financial leaders, including roughly 120 group chairs and chief executives. He told the audience that Hong Kong had become the world's largest cross-boundary wealth management centre for the first time, citing the Boston Consulting Group's Global Wealth Report published in May. At last year's summit he had predicted the city would reach that position "in the next few years."

The figures come from the Securities and Futures Commission's annual survey of the industry, released on July 2. It put total assets under management at HK$42.2 trillion at the end of 2025, above the previous peak of HK$35.5 trillion set in 2021, according to The Standard. Net fund inflows rose 193% to HK$2.1 trillion, the third straight year of growth, China Daily reported.

The private wealth slice grew fastest. Private banking and private wealth management assets rose 24% to HK$12.9 trillion, against a 19% rise to HK$30.9 trillion in asset management and fund advisory. Investors from outside Hong Kong and mainland China accounted for more than 54% of the total in recent years, and 56% of assets were invested outside the two markets in 2025, China Daily said.

Locally domiciled funds also gained. The net asset value of SFC-authorized Hong Kong funds rose 38% to HK$2.3 trillion at the end of 2025 and reached HK$2.6 trillion by the end of May, with HK$118 billion of net inflows in the first five months of 2026, The Standard reported. Some of that money has followed the city's listings boom, which Lee said raised about US$50 billion in the first nine months, second globally. Capital Times has reported on the record IPO pace and on Gulf sovereign funds' push into the city.

Family office tax bill still before LegCo

Lee pointed to legislation introduced in June to improve tax treatment for funds, single family offices and carried interest. The Inland Revenue (Amendment) bill was gazetted on June 12 and had its first reading in the Legislative Council on June 24, according to advisory firm Portcullis, which described the measures in July as proposals that take effect only once enacted. A Bills Committee finished its clause-by-clause examination by Aug. 12, when the government said it aimed to resume the second reading debate in the second half of the year. The bill was not on the agenda for the Council's Nov. 4 meeting.

The bill would apply from the 2025/26 year of assessment, and the Inland Revenue Department has let eligible taxpayers file returns for that year on the basis of the proposed rules, KPMG said. It would scrap a 5% cap on incidental transactions for family-owned investment holding vehicles and stop loans from the vehicles' own beneficiaries from counting against the HK$240 million minimum asset test.

Portcullis said the list of qualifying investments would expand to include digital assets, private credit, overseas property, carbon credits and precious metals (capped at 20%). Carried interest relief would extend beyond private equity to all asset classes covered by the funds exemption. Single-investor funds holding at least HK$240 million could also qualify without an SFC-licensed manager, as long as the investor has no day-to-day control.

More than 3,380 single family offices were operating in Hong Kong at the end of 2025, about 680 more than two years earlier, according to a Deloitte study commissioned by Invest Hong Kong and released by the government in February. Portcullis said the government aims to add more than 220 between 2026 and 2028.

Investor visa money starts flowing

A separate channel for private wealth is the New Capital Investment Entrant Scheme, which grants residence to applicants who invest at least HK$30 million in permitted assets, including HK$3 million placed in a portfolio run by the Hong Kong Investment Corporation. The state-backed fund expects at least HK$4 billion from the scheme in 2026, double the previous year, and said money from the 2024 and 2025 batches has begun to be invested, The Standard reported on Oct. 12. The government said in February that the scheme had drawn nearly 3,200 applications since its launch in March 2024.

Lee's speech did not give a date for the tax bill to pass. The next full read on the industry will be the SFC's survey covering 2026; this year's edition came out in July.