The number and wealth of HNWs in Asia Pacific has grown at more than double the rate of the rest of world in the past five years and is expected to become the world’s biggest by 2015, a new study has found.
According to the Capgemini/RBC Wealth Management Asia Pacific Wealth Report 2013, the region’s HNW population and wealth increased by 31 per cent and 27 per cent respectively in the five-year period, dwarfing the rest of the world, where the number of millionaires grew by only 14 per cent and their wealth by 9 per cent. As a result, 45.4 per cent of the world’s HNW wealth growth came from Asia Pacific.
The region’s HNW population – defined as those with investable assets of at least $1m – grew by 9.4 per cent to 3.68 million in 2012, and their wealth increased by 12.2 per cent to $12trn during the same year. North America had the largest HNW population in 2012, with 3.73 million millionaires. However, according to the study, it will be overtaken by Asia Pacific in the near future, where HNW wealth is expected to grow at 9.8 per cent a year to reach $15.9trn by 2015.
Asia Pacific also outpaced the rest of the world when it came to the UHNWs – those with investable assets of at least $30 million. The region’s UHNW population and wealth grew by 15.4 and 17.8 per cent respectively compared to 9.7 and 9.4 per cent in the rest of the world.
Thanks to economic growth
Jean Lassignardie, Capgemini Global Financial Services’ chief sales and marketing officer, said he expected the region’s fast-growing economies to boost the HNW market through 2014.
‘GDP growth of 5.5 per cent, which is more than double the global average, combined with strong equity market performance across the region and strong real estate market performance in some markets, drove robust growth in Asia Pacific’s HNW population and wealth in 2012. This GDP growth rate is projected to drive Asia Pacific’s growth in HNW population and wealth through 2014.’
All countries in Asia Pacific have seen growth in their wealth in 2012, the report also found. But Hong Kong and India have seen the biggest increases, with their HNW population rising by 35.7 per cent and by 22.2 per cent respectively and their wealth jumping by 37.2 per cent and 23.4 per cent respectively.
Japan and Taiwan were the only two markets to report single-digit increases in HNW population, at 4.4 per cent and 7 per cent respectively.
Perhaps thanks to their wealth’s recent growth, the Global HNW Insights Survey – which is a global qualitative survey Capgemini/RBC conducted together with Scorpio Partnership – found that 80 per cent of HNWs in Asia Pacific excluding Japan said they ‘highly’ trusted their wealth managers and firms, compared to about two-thirds of HNWs in the rest of the world.
The survey also found that Asia-Pacific’s HNWs had different wealth management needs than the rest of the world.
For example, 40.1 per cent of HNWs in Asia Pacific preferred to work with multiple wealth managers from one firm, compared to only 21.7 per cent in other regions. Almost 40 per cent also said it preferred digital rather direct communication with their wealth managers, compared to 21.5 percent in the rest of the world, and 42.3 percent was willing to pay more for tailored services, compared to less than 26 per cent in other regions.
Giulia Cambieri writes for Spear's