Friday, 30 January 2015

Singaporeans Richer and Richest

Suhaimi Abdullah/Getty Images
American artist Carlos Rolon poses for a photo with his showpiece ‘Untitled (Opulence)’ and a Rolls-Royce Ghost Series II at the Rolls-Royce Motor Cars Singapore showroom on January 19, 2015.

Singapore is arguably the Asia Pacific centre for private banking, one of many niches it has carved out of Hong Kong’s capital markets dominance over the last 10 years. But is it where the wealth is, or just where the wealth goes?

A new report from WealthInsight states the overall high net worth individual wealth in Singapore at US$748.8 billion in 2013, a figure that has risen 51.7% since the recovery from the global financial crisis began in 2009. The study expects Singaporean high net worth wealth to top a trillion by 2018.

“In 2013, Singapore had over 150,000 HNWIs [High Net Worth Individuals] with their wealth standing at US$748.8 billion. Wealth also grew at a remarkable rate over 2009-2013 at 51.7%, and is expected to increase by a further 28.8% to reach US$1.03 trillion in 2018. The number of millionaires is expected to reach 182,855 by 2018”, the Report said.

Singapore’s growth through billionaires has also been large, with billionaire population (32) being larger than the entire billionaire population of Malaysia (20) by 2018.

Those numbers are short of Hong Kong’s – there, high net wealth stood at US$1.04 trillion in 2013 – but there is a growing sense that upheaval in Hong Kong, and the concern that its freedoms may be eroding, may drive more of that wealth to Singapore.

Singapore’s political and overall stability is not under threat and the environment and infrastructure for private wealth management is extremely strong.

The report says there are more than 150,000 millionaires (the point at which one becomes a HNWI under the study’s methodology) in Singapore, and that there will be another 30,000 of them by 2018; it believes the billionaire population is 32, compared to 20 in the whole of (far bigger) neighbouring Malaysia.

None of these numbers come anywhere near comparison with the US or UK, but remember Singapore’s population stands at just 5.4 million. If this study is correct, that means one person in 36 in Singapore is a millionaire. Not bad odds at all.

Singapore HNWI Facts
[1] Overall HNWI wealth in Singapore was US$748.8 billion in 2013.

[2] Singapore wealth increased by 51.7% between 2009 and 2013.

[3] 16.9% of Singapore HNWIs made their wealth in Financial Services.

[4] 36.1% of Singapore HNWI foreign wealth is invested in European countries, followed by 26.7% in the Asia-Pacific and 25.4% in North America.

[5] Singapore has 18.4% less HNWI (151,025) than Hong Kong (185,055).

[6] Singapore billionaires held 237.7% less wealth (US$69 billion) than Hong Kong billionaires (US$233 billion).

[7] 26.7% of Singapore HNWI foreign wealth is invested in Asia-Pacific countries, a lower percentage than Hong Kong HNWIs (59.6%).

[8] Singapore is forecast to have more billionaires in 2018 (32) than Malaysia (20).

“Singapore’s favourable economic and business environment demonstrates that it is one of the best places for private banking, alongside Hong Kong, London and New York. However, whilst Hong Kong keeps its stable political system, it will still remain a competitor to Singapore in the Asia-Pacific region,” says WealthInsight analyst Tom Carlisle.

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