Core Viewpoint - Family offices are not just "investment platforms" but essential tools for global families to promote wealth inheritance, governance, next-generation education, and charitable planning [4][17]. Group 1: Family Office Landscape in Hong Kong - As of now, there are over 2,700 single-family offices in Hong Kong, with more than half established by ultra-high-net-worth individuals with assets exceeding $50 million [3]. - The Hong Kong government has assisted over 1,300 overseas and mainland enterprises in establishing or expanding their businesses in Hong Kong from January 2023 to mid-2025, with 179 family offices among them [2]. Group 2: Reasons for Family Offices Establishing in Hong Kong - Hong Kong's rich history and robust ecosystem in wealth management make it Asia's leading cross-border wealth management center [8]. - The "One Country, Two Systems" framework allows Hong Kong to serve as a natural springboard for mainland capital to go global, aligning with the "14th Five-Year Plan" which positions Hong Kong as an international financial center [8]. - Hong Kong's low and direct tax rates, stable currency exchange, and mature legal system attract global funds, especially in the context of rising trade protectionism [8]. Group 3: Regional Differences in Family Office Needs - Family offices from different regions exhibit varying needs in wealth inheritance and asset allocation. For instance, European and American family offices often have established governance structures and seek investment opportunities in Asia through Hong Kong [9]. - ASEAN family offices, often established by first or second-generation entrepreneurs, focus on private investments and global expansion, using Hong Kong as a gateway to the Chinese market [9]. - Mainland family offices prioritize global asset allocation and wealth inheritance planning, emphasizing tax compliance and risk control [9]. Group 4: Advantages and Protections Offered by Hong Kong - Hong Kong's status as a leading international financial center benefits from the "One Country, Two Systems" framework, attracting family offices globally [10]. - The region has a mature anti-money laundering regulatory framework and strong privacy protection laws, making it an attractive jurisdiction for high-net-worth individuals [11]. Group 5: Future Trends and Developments - An increasing number of families are expected to use Hong Kong for global asset allocation, investing in stocks, alternative investments, sustainable investments, and digital assets [16]. - Family offices are evolving into tools for governance, next-generation education, and charitable planning, with Hong Kong supporting long-term family development and wealth transmission [17]. Group 6: Role of Technology in Family Offices - Many family offices are leveraging technology for daily operations and reporting, while also focusing on investments in the tech sector [18]. - Hong Kong's proximity to Shenzhen, a tech hub, provides significant opportunities for family offices to engage with technological advancements [18][19].

Core Insights - The Hong Kong Special Administrative Region (HKSAR) government has assisted over 1,300 overseas and mainland Chinese enterprises in establishing or expanding their businesses in Hong Kong from January 2023 to mid-2025, with family offices accounting for 179 of these entities [2] - There are currently over 2,700 single-family offices in Hong Kong, with more than half established by ultra-high-net-worth individuals with assets exceeding $50 million [2] - Family offices serve as important tools for wealth management, family governance, education, and charitable planning, providing specialized services for long-term family development and wealth transmission [2] Investment Trends - 147 family offices are preparing or have decided to establish or expand their operations in Hong Kong, with over 40% coming from regions such as Europe, Asia-Pacific, Oceania, and the Middle East [4] - Hong Kong's historical depth in wealth management and its status as Asia's leading cross-border wealth management center attract global family offices [5] - The "One Country, Two Systems" framework allows Hong Kong to serve as a natural springboard for mainland capital to access international markets, aligning with China's 14th Five-Year Plan [5] Regional Differences in Family Office Needs - Family offices from Europe typically have mature management philosophies and governance structures, focusing on long-term capital preservation, technology investments, and cultural transmission [6] - ASEAN family offices, often established by first or second-generation entrepreneurs, prioritize private investments and global expansion, using Hong Kong as a gateway to the Chinese market [6] - Mainland family offices emphasize global asset allocation, wealth transmission planning, tax compliance, and risk control, increasingly focusing on impact investing and family governance [6] Regulatory and Operational Advantages - Hong Kong's unique dual attributes as a common law jurisdiction with high autonomy and international connectivity attract family offices globally [7] - The region has a robust anti-money laundering framework and privacy protection laws, making it a preferred jurisdiction for high-net-worth individuals [7] - Family offices can leverage Hong Kong's international financial system for global asset allocation and easier access to mainland investment opportunities [8] Future Development Trends - Family offices are expected to increasingly use Hong Kong for global asset allocation, investing in stocks, alternative investments, sustainable investments, art, and digital assets [10] - The region's resilience amid international political and economic instability positions it as an ideal safe haven for family offices [10] - Family offices will evolve beyond mere investment platforms to become essential tools for family governance, education, and charitable planning [10] Technological Integration - Many family offices are adopting technology to assist with daily operations and reporting, while also focusing on investments in the tech sector [11] - Hong Kong's proximity to Shenzhen, a hub for technological advancement, provides significant opportunities for family offices to engage with tech innovations [11] - The region's strong intellectual property protection framework further attracts technology companies and family offices seeking to explore opportunities [11]

Group 1: Family Office Growth - The family office industry is rapidly expanding, with over 8,000 family offices managing approximately $3.1 trillion in assets globally, comparable to the hedge fund industry [1][5] - By 2024, the number of family offices is expected to exceed 8,000, managing $3.1 trillion, and by 2030, this number is projected to grow to nearly 11,000, managing $5.4 trillion [5] Group 2: Singapore's Competitive Edge - Singapore has significantly reduced the tax incentive waiting period for wealthy individuals establishing family offices from 12 months to a maximum of 3 months [2] - The Monetary Authority of Singapore (MAS) is collaborating with private banks to further shorten client onboarding times to attract more high-net-worth individuals [2] - As of 2024, Singapore is expected to have over 2,000 single-family offices, a 42.9% increase from 1,400 in 2023 [6] Group 3: Regulatory Challenges and Responses - Following a major money laundering case, Singapore tightened regulations on family offices, increasing scrutiny and raising qualification criteria for tax incentives [2][4] - The MAS has imposed significant fines totaling 27.45 million SGD (approximately 15.4 million RMB) on nine financial institutions for anti-money laundering violations [4] Group 4: Global Competition for Family Offices - The competition among global financial centers for family offices is intensifying, with regions like Switzerland, Hong Kong, and Dubai also implementing tax incentives to attract wealthy individuals [9] - Hong Kong is enhancing its position as a family office hub with favorable tax policies and streamlined processes, aiming to attract 200 family offices by 2025 [10][12] Group 5: UAE's Emergence as a Family Office Hub - The UAE is becoming a modern family office center due to its favorable tax regime, low crime rate, and strategic geographic location [13][15] - Dubai International Financial Centre (DIFC) has launched the world's first family wealth center, aiming to deepen its family wealth ecosystem [13]

Investment Rating - The report assigns an "Accumulate" rating for the first time to Derlin Holdings (01709.HK) [1] Core Views - Derlin Holdings is positioned as a leading financial services platform in Asia focused on family office business, with a strong emphasis on wealth management and technology-driven solutions [9][14] - The company is expected to see significant growth in its family office business, driven by increasing demand from high-net-worth individuals and supportive policies in Hong Kong [9][45] - The integration of AI technology into financial services is a core strategy for Derlin, aiming to democratize access to wealth management services [9][58] Summary by Sections Company Overview - Derlin Holdings, formerly known as Derlin Securities, has evolved into a comprehensive financial services provider since its establishment in 2011, focusing on high-net-worth families and businesses [14][15] - The company has successfully completed a reverse takeover and has been actively expanding its service offerings through acquisitions [15][17] Business Performance - The company reported a revenue of HKD 1.90 billion for the fiscal year ending March 31, 2025, a decrease of 6.4% year-on-year, while net profit increased by 36.9% to HKD 1.37 billion [9][26] - The family office business has shown significant growth, with service fees from investment management reaching HKD 58.08 million in FY2023, up from HKD 18.70 million in FY2022 [56] Market Opportunities - The number of high-net-worth individuals in China is increasing, with a total of 3.16 million individuals holding investable assets of HKD 101 trillion as of 2022, creating a growing market for family office services [38][40] - Hong Kong is positioned to become a hub for family offices due to its favorable regulatory environment and the increasing number of ultra-high-net-worth individuals [45][49] Technological Integration - Derlin Holdings is committed to using AI to enhance its service offerings, having launched Asia's first AI family office, which aims to provide personalized wealth management solutions [58][62] - The company has introduced Synapse Technology, a project designed to create an intelligent financial ecosystem that leverages AI for investment and financial services [62][64] Financial Projections - The report forecasts Derlin Holdings' net profit to reach HKD 1.38 billion, HKD 1.53 billion, and HKD 1.65 billion for the fiscal years 2026, 2027, and 2028, respectively, with corresponding growth rates of 0.81%, 11.18%, and 7.84% [1][9]

Core Viewpoint - Hong Kong government is enhancing the tax incentives for family offices and funds to attract more high-net-worth individuals and family offices to establish their operations in the region [1][6][8]. Group 1: Regulatory Framework - Family offices are defined as private wealth management companies established by ultra-high-net-worth individuals to manage family assets [2]. - The Hong Kong government emphasizes strict compliance with regulations for family office activities, including due diligence by professionals providing services to these offices [3][4]. - The licensing system under the Securities and Futures Ordinance requires family offices engaging in regulated activities to obtain a license and adhere to applicable conduct standards [2][3]. Group 2: Tax Incentives - The government has implemented measures to prevent tax avoidance within the tax incentive framework for family offices and funds, ensuring that entities operating for commercial purposes do not benefit from tax exemptions [3][4]. - Proposed optimizations to the tax incentive system include broadening the definition of "funds," increasing the types of eligible transactions for tax relief, and introducing a tax reporting mechanism to ensure compliance with tax exemption conditions [6][8]. Group 3: Industry Growth and Talent Development - The Hong Kong government aims to strengthen its position as a global hub for family offices, with a target of assisting at least 200 family offices to establish or expand their operations by the end of 2025 [8][9]. - Since 2016, over 4,700 applications for funding of professional training courses in asset and wealth management have been approved, indicating a commitment to developing a skilled workforce in this sector [7]. Group 4: Market Potential - According to UBS's report, Asia-Pacific is expected to become the primary investment hotspot, with nearly half of the family offices in the region planning to increase their asset allocation there over the next five years [8]. - As of the end of 2023, Hong Kong is home to approximately 2,700 single-family offices, with over half managing assets exceeding $50 million [9].

Core Viewpoint - Hong Kong is positioned as a leading global hub for family offices, leveraging its unique advantages under the "One Country, Two Systems" framework to attract high-net-worth individuals and their wealth management needs [2][4][6] Group 1: Family Office Landscape - There are currently over 2,700 single-family offices in Hong Kong, with more than half established by ultra-high-net-worth individuals with assets exceeding $50 million [2] - The Hong Kong Investment Promotion Agency aims to attract an additional 200 family offices this year [2] - Newly established family offices in Hong Kong could generate an additional $600 million in local business spending annually [3] Group 2: Economic Impact - The development of family offices can expand specialized financial and non-financial services, creating more job opportunities through both internal hiring and outsourcing [3] - The growth of family offices is expected to enhance Hong Kong's financial market and asset management sector, contributing to the sustainable development of finance, technology, culture, and philanthropy [3] Group 3: Regulatory and Tax Environment - Hong Kong's legal system, characterized by its common law framework, provides a secure and stable investment environment for family offices [6][7] - The territory has a simple and low tax regime, with no sales tax, capital gains tax, or inheritance tax, making it an attractive location for family offices [6] - A tax incentive law specifically for single-family offices was passed by the Legislative Council in May 2023 [6] Group 4: Privacy and Security - Hong Kong is recognized for its robust privacy protection laws and high standards of confidentiality, which are crucial for the operation of family offices [7] - The region has a comprehensive regulatory framework, including anti-money laundering and counter-terrorism financing measures, ensuring a secure environment for family office activities [7] Group 5: Future Outlook - Hong Kong aims to attract family offices from both developed and emerging markets, with a focus on regions such as ASEAN and the Middle East [7] - The Investment Promotion Agency plans to host over 260 events in 2024 to promote Hong Kong's advantages and attract more family offices [7]

Group 1 - Hong Kong is increasingly recognized as a vital hub for family offices, with expectations to host around 3,000 family offices in the near future [2][10][11] - The city has over 2,700 family offices, with more than 30% managing assets exceeding $100 million (approximately 780 million HKD) [4] - The Hong Kong government aims to attract over 200 large family offices by the end of the year, with over 160 already assisted in establishing or expanding their operations [7][10] Group 2 - Hong Kong's competitive edge over Singapore in attracting family offices includes its flexible regulatory environment and tax incentives, while Singapore focuses on long-term investment capital [8][10] - The government is planning additional tax incentives for family offices, including exemptions for investments in private loans, virtual assets, and carbon credits, with proposals expected to be submitted for legislative approval [8][10] - The city is positioned to benefit from global investors seeking stability amid uncertainties in the U.S. policy environment [10][11] Group 3 - Hong Kong ranks second globally in the density of ultra-high-net-worth individuals, with 12,546 individuals having wealth exceeding $30 million [11] - The city has shown economic resilience, with a growth rate of 2.5% over the past year and a significant increase in IPO activities, raising 17.7 billion HKD in the first quarter of 2025 [11][12] - HSBC plans to significantly invest in Hong Kong, reallocating $1.5 billion from lower-return markets to focus on wealth management in the region [15][16] Group 4 - The Hong Kong government has signed agreements with 18 key enterprises, projecting an investment of approximately 50 billion HKD and the creation of over 20,000 jobs [17] - Despite challenges such as geopolitical risks and competition from Singapore, Hong Kong's robust legal framework and financial infrastructure position it well to become a leading family office center in the Asia-Pacific region [17]