Finance

Family offices, which manage significant amounts of money for wealthy families, often with small staffs, have become lucrative targets for hackers.
But a growing fear of cyberattacks has not translated into better defenses.
A recent survey shows less than a third of family offices say their cyber risk management processes are well-developed.

A computer with a “system hacked” alert due to a cyber attack on a computer network.
Teera Konakan | Moment | Getty Images

A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide to the high net worth investor and consumer. Sign up to receive future editions, straight to your inbox.
Family offices are under increasing attack from cybercriminals, and many don’t have the staff or technology to prepare, according to a new survey.

More than three quarters, 79%, of North American family offices say the likelihood of a cyberattack “has increased dramatically in the past few years,” according to a survey of single-family offices by Dentons, a global law firm. A quarter of family offices surveyed reported suffering a cyberattack in 2023, up from 17% in 2020. Half say they know another family office that suffered a cyberattack, according to the survey.
With their large wealth and small staffs, family offices have become lucrative targets for hackers and cybercriminals, experts say.
“It’s the Willie Sutton effect,” said Edward Marshall, global head of family office and high net worth at Dentons, referring to the famous bank robber who targeted banks “because that’s where the money is.”
Marshall said family offices often have minimal staff with access to highly sensitive information about a wealthy family’s finances and private companies. Since family offices value efficiency and speed over risk management, he said, today’s family offices often don’t have adequate technology and planning in place for possible cyberattacks.
“Family offices often have a bias toward efficient service versus security,” he said.

Using in-house security teams can be expensive for family offices, he added, while using third-party vendors and suppliers also creates risks from “sophisticated criminals and bad actors.”
The growing fears of cyberattacks, however, have not yet translated into better defenses. Less than a third of family offices say their cyber risk management processes are well-developed, according to the survey. Just 29% say their staff and cyber-training programs are “sufficient,” and less than half said they have upgraded staff training programs or regularly update cyber policies.
“These findings reveal an alarming gap between awareness of cybersecurity risks and the actions put in place to prevent and repel attacks,” the report said.
A separate report from EY U.S. and the Wharton Global Family Alliance says family offices should tackle cybersecurity by addressing each of the three main components of tech risk: hardware, software and applications.
Rather than sending emails with financial information or personal information, the report recommends that family offices use a website or intranet site. The report also suggests the use of password vaults and better vetting of tech vendors for security.
Marshall said family offices need to take a more proactive stance on overall assessment that goes beyond cyberattacks.
“They need a mind shift from accepting the unexpected to expecting the unexpected,” he said.
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China’s sweeping moves on Friday to increase support for real estate will take time to show results, analysts said.
For real estate to see significant stabilization, homebuyers’ demand and confidence will need to improve after a market downturn of nearly three years, Edward Chan, director, corporate ratings, S&P Global Ratings, said during the firm’s webinar on Monday.
S&P is still sticking to its base case from earlier in the month that China’s property market is likely still “searching for a bottom,” he said.

A real estate construction site in Wanxiang City, Huai ‘an City, East China’s Jiangsu province, May 17, 2024. 
Future Publishing | Future Publishing | Getty Images

BEIJING — China’s sweeping moves on Friday to increase support for real estate will take time to show results, analysts said.
Despite the news, S&P is still sticking to its base case from earlier in the month that China’s property market is likely still “searching for a bottom,” Edward Chan, director, corporate ratings, said during the firm’s webinar on Monday.

“The significance of the policy rollout last Friday was that the government is rolling out all these policies at one go, at the same day, at one time,” he said. “This shows the government is serious, as well as dedicated, in stabilizing the property sector.”
But he pointed out that for real estate to see significant stabilization, homebuyers’ demand and confidence will need to improve after a market downturn of nearly three years.
Hong Kong-listed property stocks surged late last week, but were barely changed on Monday, according to an industry index from financial database Wind Information.

Chinese authorities on Friday lowered down payment minimums to as low as 15%, versus 20% previously, in addition to cancelling the floor on mortgage rates nationwide.
Policymakers also sought to boost developers’ liquidity by releasing 300 billion yuan ($42.25 billion) in financing for local state-owned enterprises to buy unsold, completed apartments in order to turn them into affordable housing.

We believe Beijing is headed in the right direction with regard to ending the epic housing crisis.

Chief China economist, Nomura

“Although some of these measures are unprecedented (e.g., the minimum downpayment requirement was never below 20% previously), they are still insufficient compared to our property team’s estimates of at least RMB1tn funding needed to start digesting excess inventory and to allow new home prices to find a bottom within a year,” Goldman Sachs’ Chief China Economist Hui Shan said in a note Sunday.
“We believe Beijing is headed in the right direction with regard to ending the epic housing crisis,” Nomura’s Chief China Economist Ting Lu said in a report Monday.
“Beijing has already pivoted from building public housing to ensuring the delivery of numerous pre-sold homes to rebuild buyers’ confidence, marking a significant step towards cleaning up the big mess.”
“However, this is proving to be a daunting task, and we think markets need to exercise more patience when awaiting more draconian measures,” he said.
Official data released Friday showed real estate investment declined at a steeper pace in April versus March, with new commercial floor space sold for the first four months of the year down by 20.2% from a year ago. The data also showed retail sales grew less than expected in April.
The majority of household wealth is in property, while uncertainty about future income has weighed on consumer spending.

Rebuilding homebuyer confidence

Homebuyers’ confidence depends partly on their economic outlook, and whether they can receive apartments they have paid for but have yet to receive, S&P’s Chan said.
Apartments in China are usually sold ahead of construction. But in recent years, financing troubles for property developers and other issues have prolonged delivery times — with some buyers waiting for several years.

“If there is stabilization in home price, I think there will be more homebuyers willing to enter the market,” Chan said. He noted that since buying an apartment is a major investment for most people, they “don’t want to see their capital shrinking.”
The official 70-city house price index released Friday fell more quickly in April than in March, according to Goldman Sachs analysis that looks at a seasonally adjusted, annualized weighted average.
Housing prices in China have dropped by 25% to 30% on average from their historical highs in 2020 and 2021, Nomura’s Lu estimates.
He also estimates there are still around 20 million pre-sold apartments that have yet to be completed, for a funding gap of around 3 trillion yuan ($414.58 billion).
Lu expects that in the next few months, Beijing will likely conduct a national survey of residential projects to estimate how much money is needed to finish construction and deliver homes.
“In our view, rebuilding homebuyers’ confidence in the presale system is the precondition for a true revival of China’s housing markets,” he said. More

JPMorgan Chase CEO Jamie Dimon signaled retirement is closer than ever, striking a key change in messaging during the bank’s investor day.
The ambiguity of Dimon’s plans has made succession timing at JPMorgan one of the persistent questions for the bank’s investors and analysts.
Dimon is 68 years old.
“We’re on the way, we’re moving people around,” Dimon said.

Jamie Dimon, Chairman and CEO of JPMorgan Chase, testifies during a Senate Banking Committee hearing at the Hart Senate Office Building on December 06, 2023 in Washington, DC.
Win Mcnamee | Getty Images

Jamie Dimon’s days as CEO of JPMorgan Chase are numbered — though it is unclear by how much.
In a response to a question Monday about the bank’s succession planning, Dimon indicated that his expected tenure is less than five more years. That is a key change from Dimon’s previous responses to succession questions, in which his standard answer had been that retirement was perpetually five years away.

“The timetable isn’t five years anymore,” Dimon said at the New York-based bank’s annual investor meeting.
The ambiguity of Dimon’s plans has made succession timing at JPMorgan one of the persistent questions for the bank’s investors and analysts. Over nearly two decades, Dimon, 68, has made his lender the largest in America by assets, market capitalization and several other measures.
Still, Dimon added Monday that he still has “the energy that I’ve always had” in managing the sprawling company.
The decision of when he moves on will ultimately be up to JPMorgan’s board, Dimon said, and he exhorted investors and analysts to examine the executives who could take his place.
Atop the short list of candidates is Marianne Lake, CEO of JPMorgan’s consumer bank, and Jennifer Piepszak, who co-leads its commercial and investment bank. The executives were given their latest assignments in January.

“We’re on the way, we’re moving people around,” Dimon said.
Even when he steps down as CEO, however, it is likely he will stay on as the bank’s chairman, JPMorgan has said.

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When pressed about the timing of a potential boost to the bank’s share repurchase program, Dimon did not mince words.
“We’re not going to buy back a lot of stock at these prices,” Dimon said.
JPMorgan, the biggest U.S. bank by assets, has seen its shares surge 40% over the past year, reaching a 52-week high of $205.88 on Monday before Dimon’s comments dinged the stock.

Jamie Dimon, CEO of JPMorgan Chase, testifies during the Senate Banking, Housing and Urban Affairs Committee hearing titled Annual Oversight of Wall Street Firms, in the Hart Building on Dec. 6, 2023.
Tom Williams | Cq-roll Call, Inc. | Getty Images

Jamie Dimon thinks shares of JPMorgan Chase are expensive.
That was the message the bank’s longtime CEO gave analysts Monday during JPMorgan’s annual investor meeting. When pressed about the timing of a potential boost to the bank’s share repurchase program, Dimon did not mince words.

“I want to make it really clear, OK? We’re not going to buy back a lot of stock at these prices,” Dimon said.
JPMorgan, the biggest U.S. bank by assets, has seen its shares surge 40% over the past year, reaching a 52-week high of $205.88 on Monday before Dimon’s comments dinged the stock. That 12-month performance beats other banks, especially smaller firms recovering from the 2023 regional banking crisis.
It also makes the stock relatively pricey as measured by price to tangible book value, a commonly used industry metric. JPMorgan shares traded recently for around 2.4 times book value.

‘A mistake’

“Buying back stock of a financial company greatly in excess of two times tangible book is a mistake,” Dimon said. “We aren’t going to do it.”
Dimon’s comments about his company’s stock, as well as an acknowledgement that he may be nearing retirement, sent the bank’s shares down 4.5% Monday.

To be clear, JPMorgan has been repurchasing its stock under a previously authorized buyback plan. The bank resumed buybacks early last year after taking a pause to build up capital under new expected guidelines.
Dimon’s guidance simply means it is unlikely the program will be boosted anytime soon. JPMorgan is likely to purchase shares at a $2 billion to $2.5 billion quarterly clip, Portales Partners analyst Charles Peabody wrote in a March research note.
The JPMorgan CEO has often resisted pressure from investors and analysts that he deemed short-sighted. When interest rates were low, Dimon kept relatively high levels of cash, rather than plowing funds into low-yielding, long-term bonds. That helped JPMorgan outperform other lenders, including Bank of America, when interest rates jumped higher.

Underappreciated risks

Dimon’s desire to hoard cash is not just because of impending capital rules. On multiple occasions Monday, he said he was “cautiously pessimistic” about economic risks, including those tied to inflation, interest rates, geopolitics and the reversal of the Federal Reserve’s bond-buying programs.
Markets are currently underappreciating those risks, Dimon said. For instance, prices of high-quality corporate bonds do not adequately reflect the potential for financial stress, Dimon said.
“The investment grade credit spread, which is almost the lowest it’s ever been, will be dead wrong,” Dimon said. “It’s just a matter of time.”
Since 2022, Dimon has warned of an economic “hurricane” set off by geopolitical risks and quantitative tightening. While the continued strength of the economy has surprised many on Wall Street, including Dimon, his concerns have informed his decision-making process ever since.
“We’ve been very, very consistent — if the stock goes up, we’ll buy less,” he said Monday. “When it comes down, we’ll buy more.”

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There is only one problem with the chatter about Europe’s “soft landing”: its economy never truly flew. While America’s growth has consistently amazed, Europe’s has been miserable. Exclude Ireland, where national statistics are distorted by multinational companies minimising their tax bills, and the EU’s GDP has risen by about 3% since 2019, compared with a 9% increase in America.Yet Europe’s economic outlook is undoubtedly improving. Data published on May 15th showed that the euro zone grew by 0.3% in the first quarter of this year against the previous quarter. Although a modest rise, this was the first significant growth in six consecutive quarters and enough for the currency bloc to emerge from a recession. The same day the European Commission upgraded its forecasts of EU growth for 2024. “We believe we have turned a corner,” cheered Paolo Gentiloni, a commission official. More

Airline fares from the U.S. have broadly fallen over the past year, according to the consumer price index.
But there are still cities and regions where average prices have gotten more expensive, like flights to Tokyo, Canada, South America, and the Middle East and Africa.
Consider being more flexible with travel plans and book well ahead to reduce spending on airfare. Avoiding checked-bag fees is another way to save.

Coroimage | Moment | Getty Images

Americans traveling this summer have broadly seen prices fall for airline fares, a welcome trend after last year’s sticker shock.
But airfare remains more expensive in 2024 for some regions and destinations, largely for trips abroad, data shows.

For example, an average round-trip flight to Tokyo, Japan — one of the top hot spots for American tourists — costs $1,372 this summer, up 2% from 2023, according to travel site Hopper.
Flights to Canada, South America, and the Middle East and Africa regions are also up 6%, 2% and 1%, respectively, from summer 2023, Hopper found.
Of course, there’s significant variation among the cities and countries of such vast regions and continents.
More from Personal Finance:Some vacationers expect to carry summer travel debtA controversial hack to save on airfare carries ‘super big risk’New Europe travel requirement delayed to 2025
For example, while the price of a round-trip fare to Asia is flat from a year ago, those for certain destinations have soared: by 65% (to $3,196) for an average flight to Sakata, a coastal city in the northeast of Japan; by 42% (to $4,190) to Ipoh, among Malaysia’s biggest cities; and by 35% (to $4,092) to Udon Thani, in Thailand’s northeast, according to Hopper.

High prices to certain Asian cities impact many American tourists since the continent is their second-most frequented international travel destination, Hopper said.
Flights are also up for some major hubs in South America, according to Hopper: by 16% (to $955) to Rio de Janeiro, Brazil; by 34% (to $667) to Lima, Peru; and by 13% (to $826) to Santiago, Chile, for example.
Average fares to Europe, the most popular trip abroad for Americans, are down 8% in summer 2024 versus a year ago, when they were at record highs. But they’re still elevated in some areas like Friedrichshafen and Memmingen, in southern Germany, and Bratislava, Slovakia. Fares there are up 265%, 109% and 99%, respectively.

Travel prices have fallen broadly

Westend61 | Westend61 | Getty Images

“Last year was kind of an extraordinarily expensive year,” said Hayley Berg, lead economist at Hopper.
International travel was especially costly as consumers unleashed pent-up demand to go abroad following Covid-19-related restrictions, many nations reopened their borders to foreign visitors, airlines worked to re-establish their flight schedules and jet fuel prices soared.  
Some of those dynamics haven’t yet unwound for certain areas. Additionally, specific destinations have their own idiosyncratic supply-and-demand factors that have kept prices high.
Overall, though, travelers have gotten broad price relief.
Average airline fares for flights originating in the U.S. fell by 5.8% in the year from April 2023 to April 2024, according to the consumer price index. They’ve declined almost 1% in just the past month.

“Mostly what we’re seeing [now] is tremendous improvement across most routes,” Berg said. “I do expect that to continue.”
However, Americans may feel flight prices are broadly increasing due to certain airline trends like higher fees for checked bags, said Sally French, a travel expert at NerdWallet.
Major carriers including Alaska Airlines, American Airlines, Delta Air Lines, JetBlue Airways and United Airlines raised their checked-bag fees this year, for example.

While those fee hikes are generally $5 more per bag, that can add up, especially for round-trip fares for families, French said.
“It can completely inflate the cost of your trip,” she said.
There are ways to save, though, such as flying with certain airlines, combining bags, or even trying to forgo checking a bag altogether. If you know you’ll have to check a bag, doing so ahead of flight check-in will likely save you money, too.
Booking a flight well ahead — at least one to three months before a domestic trip, and three to four months ahead of international travel — is another way to save on flight costs, French said. Airlines generally don’t reduce airfare at the last minute, unlike many hotels, for example, she said.
Other ways to save include being flexible with travel time — perhaps by visiting a destination during a shoulder season instead of its peak, or flying mid-week instead of around weekends. Don’t forget to use rewards like frequent-flier miles and certain perks like travel insurance offered by some credit cards. More

The U.S. Securities and Exchange Commission is expected to make a key decision on approving ether exchange-traded funds next week.
But it will likely fail due to a lack of an over-arching regulatory framework for all cryptocurrencies, according to Ric Edelman, head of the Digital Assets Council of Financial Professionals.

“I think that there’s going to be another delay, which is frankly, not really bad news,” Edelman told CNBC’s “ETF Edge” this week.
Edelman, an investor and personal finance author, thinks there needs to be an emphasis on regulations to protect people from crypto scams. He notes current laws are more than a half century old and are not built for digital technology.
“Without any cop on the beat, it’s forcing investors to go on their own outside of the investment advisory community because the community can’t help them because we don’t know what the rules are. And they’re ending up in scams and frauds,” he said. “The sad irony is that [SEC Chair Gary] Gensler is claiming to be wanting to protect the consumer. But his refusal to write regulation is actually harming the consumer rather than helping.”
Bitwise Asset Management’s Matt Hougan is also pushing for new rules.
“80-year-old securities laws don’t fit neatly into this world of digital assets, crypto and 21st century technology,” the firm’s chief investment officer said. “Ultimately, I think everyone wants the same thing. They wanted a safe, secure platform where investors are protected, and innovation is protected.”

Hougan notes Bitwise has its own application for a spot ethereum ETF and is hopeful about the future.
“We’ve entered the ETF era for crypto. We’ve seen the bitcoin ETFs come to market. We’ve seen the great things they’ve done for investors — lowering costs, improving regulation, improving sort of safety, security and peace of mind.,” Hougan said. “I think we will get there on ethereum as well.”
The two ether ETF proposals, submitted by VanEck and ARK Investments/21Shares, are set to be approved or denied this month.
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Citing people familiar with the matter, Bloomberg said that “one option an internal team at the Chinese insurance giant is considering is further share sales, similar to the $50 million sale it disclosed last week.”
Ping An has butted heads with HSBC’s management in recent years, most notably supporting a shareholder motion in 2023 that sought to spin off its Asia business and establish fixed dividends.

Customers use automated teller machines (ATM) at an HSBC Holdings Plc bank branch at night in Hong Kong, China, on Saturday, Feb 16, 2019.
Anthony Kwan | Bloomberg | Getty Images

Shares of HSBC Holdings fell over 3% in Hong Kong on Friday after reports that its top shareholder Ping An Insurance might be looking to cut its stake in the British bank.
Despite the fall, HSBC’s share price is still at its highest since August 2018, trading at about 68 Hong Kong dollars per share.

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Citing people familiar with the matter, Bloomberg reported the Chinese insurer is looking at possibly reducing its stake in the bank further “as it seeks to reduce its $13.3 billion position in Europe’s largest lender.”
There are several options including “further share sales, similar to the $50 million sale it disclosed last week.”
Ping An sold HSBC shares worth 391.49 million Hong Kong dollars ($50.19 million) on May 7, cutting its stake from 8.01% to 7.98%.
The sale marked the first disposal of shares from Ping An since it backed a 2023 shareholder motion that sought to spin off its Asia business and establish fixed dividends. That motion was eventually defeated.
“A sovereign wealth fund or ultra-rich investor in the Middle East taking a sizable stake is another possibility,” Bloomberg said, citing unnamed sources. More