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Number of rich in Singapore on the rise

The number of millionaires here rose by 4.5 per cent last year to about 105,000, according to the latest World Wealth Report from Capgemini and RBC Wealth Management.

SINGAPORE: The number of high net worth individuals (HNWIs) in Singapore grew by 4.5 per cent last year to about 105,000, lagging the global growth rate of 15 per cent amid a tapering in the city-state’s home prices.

This is according to latest figures from the annual World Wealth Report, released by Capgemini and RBC Wealth Management on Wednesday night in the US (June 19, Thursday morning, Singapore time). The report defines HNWI as someone with US$1 million or more in investable assets.

Capgemini and RBC said in a statement that improving economic and equity market performance helped add 1.76 million people to the global HNWI population in 2013, while the investable wealth of HNWIs grew by nearly 14 per cent to reach a record high of US$52.62 trillion.

At the top, Asia Pacific and North America are neck-and-neck when it comes to adding more wealthy people with Asia Pacific's high net worth individuals growing 17 per cent to reach 4.32 million compared to North America's 16 per cent.

Still, North America maintained its position as the wealthiest region, increasing its HNWI wealth by 17 per cent to reach US$14.8 trillion, though this growth was outpaced by Asia Pacific, where the HNWI wealth rose 18 per cent.

The number of wealthy individuals and their corresponding wealth in Singapore also increased in 2013 but growth was constrained by declining equity and property markets.

Grace Barki, managing director and head of RBC Wealth Management (Southeast Asia), said: "If you look at 2013, it was a slow market both in terms of asset classes and in addition the volatility in currency market was also pretty flat. So from that angle, there was not much trading going on in 2013.

“Real estate prices, due to inflationary reasons have been dampened and even in Singapore, there has been a contraction of 0.9 per cent. And aside from that, if you look at the MSCI Index in Singapore, it was down about 1.8 per cent.”

Still, analysts say more of Singapore's high net worth individuals are no longer concentrating their investments domestically, but venturing overseas.

Barki said: "Property will still remain one of the more important asset class that most Asian HNWIs, especially Singaporeans, like to dabble in but if you look at Singaporeans dabbling totally into real estate in Singapore, that's no longer the case.

"They've gone overseas to invest in Australia, London and Japan is coming up on the horizon because of the Olympics coming in."

Claire Sauvanaud, vice president of Capgemini Financial Services, said: "Singapore ranks number 25 in the world in terms of HNWIs. It has a moderate growth compared to others but if you look at the past five years, Singapore has grown above average over the past five years."

High net worth individuals in Singapore saw moderate growth in its population and wealth in 2013, pretty much keeping pace with some of its Asian neighbours.

According to the World Wealth Report, growth in this segment was driven by expansion in the economy and higher savings. Another interesting fact though is that these wealthy individuals here are demanding more digital services from wealth management firms.

Sauvanaud said: "One of the highlights from the survey was that demand for digital interaction is massive and even more massive in Asia. In Singapore, that is a very tech savvy island.

"High net worth individuals will really be demanding for that, to the point that two thirds of them would leave the wealth management firm that they are dealing with if they don't have comprehensive integrated customer experience.

"That's really one area where wealth management firms invest the most because it's a survival element for them."

And when it comes to giving back to society, 70 per cent of Singapore's rich (versus the global average of 60 per cent of HNWIs) consider it an important aspect, with educational causes taking centrestage.

According to the World Wealth Report 2014, the Asia Pacific region is expected to be the largest HNWI market by population in 2014 and by wealth in 2015.

Looking ahead, global HNWI wealth is forecast to reach a new high of US$64.3 trillion by 2016, representing 22 per cent growth from 2013 levels and approximately US$12 trillion in new wealth, Capgemini and RBC said.

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