MORE BLING THAN YOU THINK
India is home to the fourth largest number of ultra-high-net-worth households that have more than 100 million dollars in private wealth, according to a new report topped by U.S.-based Boston Consulting Group, writes Yoshita Singh.
The Boston Consulting “Group’s Global Wealth 2015: Winning the Growth Game” report said continued economic expansion of China and India was driving growth in wealth in the Asia- Pacific region.
The U.S. remains the country with the largest number of ultra-high-net-worth (UHNW) households at 5,201, followed by China (1,037), the UK (1,019), India (928) and Germany (679) in 2014, it said.
India’s UHNW households grew manifold from 2013 when the number stood at 284.
The private wealth in the Asia-Pacific region expanded by a steep 29% in 2014 to reach $47 trillion, enabling it to overtake Europe (Eastern and Western Europe combined) to become the world’s second-wealthiest region, the report said.
With a projected $57 trillion in 2016, Asia-Pacific (excluding Japan) is expected to surpass North America (a projected $56 trillion) as the wealthiest region in the world and will be the largest pool for client acquisition.
The region is also projected to hold 34% of global wealth in 2019.
With a projected annual growth rate of almost 10%, private wealth in Asia-Pacific will rise to an estimated $75 trillion in 2019.
Growth in wealth in the Asia-Pacific region was driven heavily by the continued economic expansion of its two largest economies China and India, the report said.
Private wealth in China and India also showed solid market gains driven mainly by investments in local equities, it said.
China’s equity market rose by 38% and India’s by 23%, it added.
Global private financial wealth grew by nearly 12% in 2014 to reach a total of $164 trillion.
The rise was in line with 2013, when global wealth also grew by just over 12%, the report said.
Over the next five years, total private wealth globally is projected to post a compound annual growth rate of 6% to reach an estimated $222 trillion in 2019.
The U.S. remained the wealthiest individual country, ahead of both China and Japan, it said.
Globally, some three-quarters ($13 trillion, or 73%) of private wealth growth in 2014 was generated by the market performance of existing assets, with the balance ($5 trillion, or 27%) generated by newly created wealth.
Private wealth held by ultra-high-net-worth households grew by a strong 11% in 2014.
UHNW households held $10 trillion or 6% of global private wealth in 2014, in line with 2013.
At a projected annual growth of 12% over the next five years, private wealth held by the UHNW segment will grow to an estimated $18 trillion in 2019.
Globally, the total number of millionaire households (those with more than $1 million in private wealth) reached 17 million in 2014, up strongly from 15 million in 2013, the report said.
The increase was driven primarily by the solid market performance of existing assets, in both the new and old worlds, it said.
From a regional perspective, the US still had the highest number of millionaire households in 2014 (7 million), followed by China (4 million), which showed the highest number of new millionaires (1 million).
Japan was third, with 1 million millionaire households, down from previous years due to the fall of the yen versus the U.S. dollar.
According to the report, the highest density of millionaires was in Switzerland, where 135 out of every 1,000 households had private wealth greater than $1 million, followed by Bahrain (123), Qatar (116), Singapore (107), Kuwait (99) and Hong Kong (94).
As for offshore wealth originating in Asia-Pacific (excluding Japan), Singapore (31%) and Hong Kong (15%) remained the top destinations.
In addition, wealth originating in Singapore, Hong Kong, India, and Pakistan was also inclined to be booked farther away, such as in the UK (15%) and Switzerland (22%), it said.