Asia’s Millionaires Top Europe for First Time, Merrill Wealth Report Says
Millionaires in the Asia-Pacific region overtook Europe in terms of population and wealth for the first time in 2010, bolstered by economic growth in China and India, according to Capgemini SA and Bank of America Corp.
The wealth of 3.3 million high-net worth individuals in Asia Pacific climbed 12.1 percent last year to $10.8 trillion, exceeding the $10.2 trillion accumulated by 3.1 million people in Europe, according to the 2011 World Wealth Report. Global wealth held by people with at least $1 million of investable assets climbed 9.7 percent to $42.7 trillion.
“Regionally, Asia-Pacific was the real star of the growth story,” John Thiel, head of U.S. wealth management for Bank of America’s Merrill Lynch Global Wealth Management unit, said at a press briefing in New York yesterday. Stock- market returns and increases in the value of real estate in the region were major contributors, he said.
Markets rebounded following the financial crisis, with global equity market capitalization rising 18 percent in 2010, the report said. The MSCI AC World Index, which tracks global stocks in developed and emerging markets, returned 13 percent in 2010 and the MSCI Asia Pacific Index returned 17 percent, according to data compiled by Bloomberg.
Africa showed the biggest increase in millionaires by region with growth of 11.1 percent, while India entered the top 12 country rankings for the first time, with 153,000. The number of millionaires in China grew by 12 percent to 534,500. China ranked fourth in the number of millionaires, trailing the U.S., Japan and Germany.
About 53 percent of the world’s millionaires, or individuals with at least $1 million in investable assets excluding primary residences and collectibles, are found in the U.S., Japan and Germany, the report showed.
“While over half of the global high-net-worth individuals still resides in the top three countries, the concentration is fragmenting,” said Herbert Hensle, vice president and head of Capgemini’s Swiss office.
The number of millionaires in Switzerland increased by 9.7 percent last year, supported by the Alpine nation’s strong economy and real-estate market, the report said.
“Even though the Swiss franc went higher, the exports of companies here have been very successful,” Peter Schmid, chief executive officer and general manager of Merrill Lynch’s Swiss private bank, said in an interview in Zurich. The Swiss currency advanced 11 percent against the dollar in 2010, according to Bloomberg data.
Global ranks of ultra-high-net-worth individuals, defined as those with $30 million or greater of investable assets, increased at a faster pace than millionaires, rising 10 percent.
Growth in the number of global millionaires slowed from 17 percent in 2009, when wealth rebounded following the credit crisis that sent stock indexes to their worst annual losses since the Great Depression and slashed the value of real-estate holdings, hedge-fund and private-equity investments.
The investment mentality of millionaires has changed as they search for increasing returns, the report said. Wealthy individuals are allocating a higher proportion of money to riskier assets, including commodities, and also made profits from emerging-market stocks and bonds.
On May 31, the Boston Consulting Group said the number of millionaire households increased 12 percent to about 12.5 million. Singapore’s millionaire population expanded the fastest, rising by almost 33 percent, while the U.S. had the most $1 million-plus households, with 5.2 million, followed by Japan and China, the study found. Singapore also had the highest proportion of millionaire households at 15.5 percent, followed by Switzerland and Qatar.
Singapore will displace Switzerland as the world’s top wealth-management center by 2013, according to a PricewaterhouseCoopers LLP survey of global wealth-management firms released earlier this week. The firms said they expect to increase their client base among international entrepreneurs and to decrease their base among clients with less than $1 million in assets over the next two years, the study said.
Women and young millionaires account for an increasing portion of the world’s rich, Merrill’s World Wealth Report found. About 27 percent of global millionaires were women in 2010, compared with 24 percent in 2008. About 17 percent of millionaires were age 45 or younger compared with 13 percent in 2008, the report said.
Paris-based Capgemini and Merrill Lynch, a subsidiary of Charlotte, North Carolina-based Bank of America Corp. (BAC), compiled data from 71 countries representing 98 percent of the world’s gross national income.