# Private Wealth Management in Hong Kong: Frequently Asked Questions > Sixteen questions on Hong Kong private wealth management: what it is, who holds the assets, thresholds and professional investor status, discretionary versus advisory, custody and trailer fees, EAMs and family offices, SFC and HKMA supervision, KYC, policies and loans, and Mainland residents. - URL: https://privatewealth.hk/en/faq/ - Author: Private Wealth Ecosystem Editorial (https://privatewealth.hk/about/) - Reviewed by: Private Wealth Ecosystem Editorial Editorial Board - Published: 2026-11-04 - Updated: 2026-11-04 - Language: en ## Basics ### What is private wealth management, and how is it different from retail wealth management? It is the personalised banking, advisory and portfolio management service that banks and licensed corporations provide to high-net-worth clients. The difference is not the product but the process: a dedicated relationship manager, suitability assessed at portfolio level under an agreed mandate (HKMA circular of 12 June 2012), and clients who usually qualify as professional investors. Hong Kong's private banking and private wealth management assets reached HK$12.9 trillion at end-2025, up 24% (SFC, 2 July 2026). ### Who actually holds my assets: the private bank, the EAM, the family office or the insurer? Only the bank and the insurer hold anything. Custodied assets sit in your account at the bank; policy assets sit on the insurer's balance sheet and you hold a contractual right. An external asset manager has trading authority only, and a family office is a decision-making organisation; neither holds assets. ### Can a private bank be custodian, lender and product seller at the same time? Yes, and it usually is. As an authorized institution it takes deposits and lends; as a registered institution it deals, advises and manages; as a licensed insurance intermediary it sells policies. The overlap is lawful but is the main source of conflicts, which regulators require to be identified, managed and disclosed rather than eliminated. ## Thresholds and status ### What is the entry threshold for private banking in Hong Kong? There are three layers. The HKMA's 2012 definition of a private banking customer is at least US$3 million in investable assets or US$1 million under the bank's management. Banks' own published tiers in November 2026 run from HK$1,000,000 (HSBC Premier, Standard Chartered Priority) and HK$1,500,000 (Citigold) to HK$8,000,000 (Standard Chartered Priority Private); Standard Chartered Private Bank charges US$1,250 a quarter when assets fall below US$2 million (schedule of 1 July 2026). Most international private banks target clients above US$5 million internally. ### Does property count towards the threshold? No. The HKMA definition counts only securities, deposits and certificates of deposit, and since the 2018 amendment of the Professional Investor Rules real property is excluded from an individual's HK$8 million portfolio. Banks' "relationship balance" definitions vary and may include insurance premiums and MPF balances, but not a home. ### What is a professional investor, and what changes if I become one? An individual with a portfolio of at least HK$8 million (alone or jointly with spouse or children) under the Securities and Futures (Professional Investor) Rules; corporations qualify at HK$40 million in assets or an HK$8 million portfolio. The firm may then waive parts of the Code of Conduct under paragraph 15 and offer products not authorised by the SFC. It is a status, not a service. ### What is a sophisticated professional investor? A category created by the joint HKMA–SFC circular of 28 July 2023 for individual professional investors who meet wealth, knowledge-or-experience and investment-objective criteria. With written consent, the firm may let you set aside an amount for a portfolio of products of various risk levels without matching each transaction to your risk tolerance, objectives and horizon. You can opt out at any time; consider whether you want transaction-level protection before signing. ## Service models and fees ### What documents must a discretionary account have? Under paragraph 7.1 of the SFC Code of Conduct: your written authority (verbal is not enough), an explanation of its terms with confirmation at least annually of whether you wish to continue, designation as a "discretionary account" in the client agreement and records, senior management approval and internal controls. Add an investment mandate (objectives, benchmark, limits) and the monetary benefits disclosure under paragraph 7.2. ### How much does private wealth management cost per year? Add five layers: custody and account fees, transaction and subscription fees, management or advisory fees, third-party benefits (not charged to you but priced into products) and loan interest. A published example (Standard Chartered Private Bank, 1 July 2026): custody 0.20% a year, securities commission up to 1%, fund subscription up to 3%, discretionary set-up fee 1% plus programme fees, wrap service fee up to 1.50% a year. These illustrate structure, not a comparison. ### What is a trailer fee, and must the bank disclose it? An ongoing commission a fund house pays the distributor out of the fund's management fee for as long as you hold the fund. Paragraph 8.3 of the Code requires written pre-trade disclosure of the maximum percentage receivable, fund by fund; paragraph 7.2 applies the same to discretionary accounts. The Standard Chartered schedule states trailer fees are generally capped at 70% of the fund management fee. ### When may a firm call itself "independent"? Only where it receives no third-party monetary benefits and has no close links with product issuers that could affect its preferences (paragraph 10.2), and it must disclose whether it is independent (paragraph 8.3A). Bank schedules typically state they are not independent for group products, funds and IPO bonds and independent for other products; read that statement alongside the monetary benefits disclosure. ## EAMs and family offices ### Is it safe to give an EAM authority over my account? Safety depends on the custody structure. Your assets stay in your account at the custodian bank; the EAM acts under a limited power of attorney that allows trading and enquiries but not withdrawals, and you can revoke it without moving assets. Check that the EAM holds a Type 9 licence on the SFC public register, that the power of attorney excludes transfers, and that the management agreement defines the mandate. The SFC's circular of 9 October 2024 flagged managers who left concentrated positions unassessed or merely followed client instructions without exercising discretion. ### Does a family office need a licence? A single family office serving one family, not marketing to the public and not managing third-party assets generally does not need an SFC licence; the government's announcement of 10 February 2026 lists this as an advantage and counts more than 3,380 single family offices at end-2025. A multi-family office charging several families is carrying on Type 9 or Type 4 regulated activity and must be licensed. The 2023 tax concession for family-owned investment holding vehicles (0% on qualifying profits, minimum HK$240 million of assets, at least two full-time employees and HK$2 million of local expenditure) is mentioned here only; this site makes no statement about tax outcomes. ## Supervision, onboarding, policies and Mainland residents ### Who supervises a private bank and who supervises an EAM? A private bank is supervised by the HKMA as an authorized institution and registers with the SFC as a registered institution for securities business, with the SFC writing the rules and the HKMA supervising conduct; front-line staff appear in the HKMA register. An EAM is a licensed corporation supervised directly by the SFC. Insurers and insurance intermediaries are supervised by the Insurance Authority. Verify any firm or person on the SFC public register or the HKMA register using the legal entity name, not the brand. ### Why does onboarding take so long, and what does the bank need to know about my wealth? Timing depends on risk rating and documentation, from days to weeks. The HKMA circular of 7 March 2023 asks banks to establish source of wealth on a risk basis—collect, clarify, corroborate—and says "establish does not mean verify", so low-risk clients should not be asked for decades-old statements; the guidance of 12 December 2025 asks front-line staff to challenge and corroborate in higher-risk cases. Aim for a wealth narrative that public records or documents can support, not for the thickest file. ### What does a policy do inside a private wealth portfolio, and what are the rules on premium financing? A policy is a contractual right rather than a custodied asset and serves as a liquidity buffer (guaranteed cash value, policy loans), loan collateral (premium financing, policy-backed lending) and a legacy instrument (beneficiary nomination, death benefit, trust linkage). Premium financing has been subject to the Insurance Authority's standards since 1 January 2023: affordability tests, over-leveraging screening, asset verification and an Important Facts Statement signed before issuance; the loan and the policy are separate contracts and the death benefit repays the loan first. Mainland residents must sign Hong Kong policies in person in Hong Kong with the Important Facts Statement for Mainland Policyholders (effective 1 September 2016), must complete the bank's identity and source-of-wealth checks to open accounts, and should take advice in their own jurisdiction on cross-border funds, foreign exchange and tax reporting; this site carries on no sales activity in Mainland China. ## Sources and dates - Hong Kong's AUM grew 20% to record high: SFC's 2025 survey on asset and wealth management — Securities and Futures Commission (SFC) 2026-07-02 https://apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/doc?refNo=26PR103 - Selling of Investment Products to Private Banking Customers — Hong Kong Monetary Authority (HKMA) 2012-06-12 https://brdr.hkma.gov.hk/eng/doc-ldg/docId/20120612-1-EN - Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission — Securities and Futures Commission (SFC) 2024-10 https://www.sfc.hk/-/media/EN/assets/components/codes/files-current/web/codes/code-of-conduct-for-persons-licensed-by-or-registered-with-the-securities-and-futures-commission/Code_of_conduct-Oct-2024_Eng-with-Bookmark-Final.pdf - Joint circular: Streamlined approach for compliance with suitability obligations when dealing with sophisticated professional investors — Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission (SFC) 2023-07-28 https://brdr.hkma.gov.hk/eng/doc-ldg/docId/getPdf/20230728-3-EN/20230728-3-EN.pdf - Hong Kong Schedule of Fees and Charges (Private Bank) — Standard Chartered Bank (Hong Kong) Limited, Private Bank 2026-07-01 https://www.sc.com/en/uploads/sites/66/content/docs/pvb-hk-schedule-of-fees-and-charges-en.pdf - Balanced and effective AML/CFT measures in private banking (annex: Smart tips for Private Banking) — Hong Kong Monetary Authority (HKMA) 2023-03-07 https://brdr.hkma.gov.hk/eng/doc-ldg/docId/20230307-1-EN - Circular 24EC46: Deficiencies and substandard conduct noted in the management of private funds and discretionary accounts — Securities and Futures Commission (SFC) 2024-10-09 https://apps.sfc.hk/edistributionWeb/gateway/EN/circular/intermediaries/supervision/doc?refNo=24EC46 - Circular on the supervisory standards and key requirements on the use of premium financing to take out long term insurance policies — Insurance Authority (IA) 2022-04-01 https://brdr.hkma.gov.hk/eng/doc-ldg/docId/getPdf/20220401-6-TC/20220401-6-TC.pdf - Circular on Important Facts Statement for Mainland Policyholders — Insurance Authority (IA) 2016-07-08 https://www.ia.org.hk/en/legislative_framework/circulars/reg_matters/files/cir_20160708.pdf --- This site is run by Private Wealth Ecosystem Editorial, an independent insurance information site providing general education and comparison. It is not an insurer, licensed insurance intermediary or bank, sells no insurance product and accepts no application. Content has not been reviewed, approved or endorsed by the Insurance Authority (IA). For applications, quotations and policy servicing, consult a Hong Kong insurer or licensed insurance intermediary.