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China helped fuel a surge in global growth for the asset management industry last year, according to a new report from the Boston Consulting Group.

Assets under management (AuM) — a key financial industry benchmark — grew robustly in regional markets around the world in 2017, led notably by China and the US, according to Global Asset Management 2018: The Digital Metamorphosis, released Thursday by the Boston Consulting Group (BCG).

China's 22 percent growth in AuM elevated it to the fourth-largest global market, up from eighth place five years earlier. The partial opening-up and rapid growth of the Chinese market have created the conditions for a potential gold rush among foreign firms.

"We expect China's AuM to triple by 2025, which if it comes to pass would make the Chinese market the second-largest after the US," said Qin Xu, a BCG partner, leader of the asset management topic in Asia and a co-author of the report.

China's AuM rose to $4.2 trillion last year, up from $3.4 trillion in 2016 and $1.5 trillion at the end of 2012. The growth was spurred by China's high household-savings rate and reforms that have encouraged pension funds and insurers to use asset managers, the report said.

The North American market was the second standout regional performer, buoyed by US growth of 14 percent, the strongest among mature markets.

Overall, fueled by bull markets, the asset management industry's growth rebounded in 2017. Firms set global records for net inflows of assets and for profitability, according to the BCG report.

Total AuM recorded its strongest growth in a decade. The value of global AuM rose by 12 percent to $79.2 trillion in 2017, from $71 trillion in 2016, the BCG report said. That represents the strongest annual growth since 2009, when assets rebounded from the depths of the global financial crisis the year before.

"Asset managers would be wise to take advantage of a strong year to reinvest capital and talent in future growth," said Renaud Fages, a BCG partner, global leader of the asset management segment and a co-author of the report. "Most of the bounce-back growth of 2017 was market-driven, not structural," he said. "Cost pressures and fee erosion will persist, especially when equity-market growth slows, as it shows signs of doing in 2018."

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