While the market recovery from 2023 is gaining momentum, North American asset management industry struggles with stagnant revenues and declining profitability due to outflows from higher-fee active equity funds and rising costs, according to McKinsey & Co. in a recent report.
Despite these challenges, global assets under management (AUM) hit a record $132 trillion by June 2024, though profits declined by 5 percent.
Key themes include an uneven rebound across regions and products, revenue-neutral recovery driven by lower-priced strategies, and profitability pressures. However, significant opportunities lie ahead as disruptions in the balance sheets of banks, insurers, and high-net-worth investors could unlock $8 trillion to $10 trillion in new assets over the next decade. The report stresses the need for asset managers to re