Capgemini’s World Wealth Report 2016 says global wealth is projected to reach US$100 trillion by 2025. While North America growth slows, Asia-Pacific surges ahead in both High Net Worth Wealth and population, according to Capgemini.
- Global wealth is projected to reach US$100 trillion by 2025
- Wealth saw only a modest growth of four per cent globally last year
- Wealth in Asia-Pacific grew at an aggressive 10 per cent last year
- In 2015, Australia had a HNWI population of 234,000 (up from 226,000 in 2014)
- Australia ranks at #9 in markets expected to drive HNWI growth through to 2025
- Asia-Pacific is the lead region with the most HNWI wealth globally (the first time APAC is ahead of North America)
- In 2015, Asia-Pacific held US$17.4 trillion in wealth with a 5.1 million HNWI population (whilst North America held US$16.6 trillion in wealth with a 4.8 million HNWI population)
Key trends show the Asia-Pacific region is poised to drive growth over the next decade
“As wealth firms and wealth managers face a number of converging market dynamics, including increased competition from FinTechs, firms need to be making progress on all aspects of their digital capabilities to ensure they remain relevant to clients,” said Philip Gomm, financial services practice lead at Capgemini Australia.
“The latest World Wealth Report findings reinforce the need for firms to adapt to meet evolving client and manager expectations alike, as nothing less than a high level of digital maturity will be adequate in the face of digitally-native competitor providers.
“In Australia, we see historic low interest rates driving the imperative for higher yielding alternate investments to cash. Real GDP of 2.3 per cent combined with real estate growth averaging 9.7 per cent in 2015 represented key positive drivers of wealth thus seeing our HNWI population increase 3.5 per cent across 2014-15 to a total population of 226,400, by our estimates.
“On the flip side, market capitalisation declines combined with fears of an economic slowdown in China combined with declines in global commodity prices have subdued confidence and negatively impacted HNWI wealth.
“Based on this cohort’s demands, wealth managers realised the importance of digital in 2015, thus creating more pressure on firms to improve their digital maturity or risk losing profits, clients and staff.
“With our studies indicating less than 1/3 of HNWI wealth being managed by wealth managers globally, there is a significant opportunity for managers to expand share of HNWI’s investable assets, increasingly through the leverage of better digital solutions.”