Asia Pacific's population of high-net-worth individuals grew by 9.7% to 3.3 million last year, exceeding Europe's for the first time, according to the latest 2011 Asia-Pacific Wealth Report.
The rich list published by Merrill Lynch Global Wealth Management and Capgemini, places the region second only to North America.
High-net-worth individuals, which own investible assets of more than $1 million (€727,848), saw their wealth rise by 12.1% last year. Combined, they now own $10.8 trillion, compared to $10.2 trillion of those in Europe.
The Asia Pacific region has also the fastest growth rate among ultra high-net-worth individuals, which own investable assets of more than $30 million. Over the past year, the number of ultra high-net-north individuals rose by 14.9% to 23,000, while their combined wealth rose by 16.8%.
Following last year’s increase, the region is now the world’s second biggest market, although their wealth is concentrated in three countries: Japan, China and Australia. Together, they account for 74.4% of the high-net-worth individual population.
“Asia-Pacific remains a region of enormous wealth creation, spearheaded by China, India and Japan, which continues to outpace global levels,” said Michael Benz, head of Asia-Pacific Wealth Management at Merrill Lynch Global Wealth Management. “The increasing sophistication and demands of Asia-Pacific high-net-worth individuals mean that those wealth management firms that can leverage across their businesses are best-placed to better serve their clients’ needs.”
Most of the high-net-worth individuals in the region favour equities and real estate. Some 27% of their wealth is invested in real estate, with both bricks and mortar as well as other real estate assets, such as real estate investment trusts, feature high on their buy list.
Equities accounted for 26% of their investments, down one percentage point from that in 2006. They are expected to increase their exposure to equities and fixed-income holdings, while cutting the amount held in cash and deposits by next year. Amid concerns that property prices in many of their home markets are due for a corrections, it is also likely to see them reduce their relative holdings of real estate.
“Implementing a comprehensive enterprise value approach in Asia-Pacific will require iteration to capture market-specific opportunities, especially in fast-growing emerging markets,” said Jean Lassignardie, the global head of sales and marketing at global financial services, Capgemini. “Among the key components will be firm-wide accountability, appropriate incentives, and integrated IT. Most importantly, firms will need to hone their strategy for each market, and not impose arbitrary standards from highly developed markets.”
©2011 funds europe