Globe adds 1.1 millionaires as total HNWI wealth grows to $63 trillion

16 November 2017 Consultancy.uk

Rising equity markets and regional property markets, among others, led to the number of millionaires growing by 1.1 million last year. High Net Worth Individuals (HNWI), meanwhile, continue to dominate the world's wealth, with their stockpile increasing to 34% of the total, drawing from a representative sample of 1% of all HNWIs.

The world’s wealthiest have enjoyed another bumper year, as their rank and wealth continued to see robust growth. In the latest Capgemini ‘World Wealth Report’, the firm explores growth in the HNWI category, involving liquid investable assets in excess of $1 million*.
Number of HNWIs, 2010-2016
The number of HNWI’s has grown for the seventh  year in a row, with the most recent boost adding more than 1.1 million people into the category since last year. Africa led the growth charge, seeing 8.1% growth in the number of individuals, followed by North America, up by 7.8%, and Europe, up by 7.7%. The Middle East, mired by low commodity prices, saw the lowest level of growth at 4.8%.

Overall, the Asia Pacific region has the largest number of HNWIs at 5.5 million, followed by North America at 5.2 million. Europe is home to around 4.5 million HNWIs, while the Middle East, Latin America and Africa house 0.6 million, 0.6 million and 0.2 million respectively.
HNWI financial wealth 2010-2016Total wealth, meanwhile, grew by $4.8 trillion to a total of $63.5 trillion - buoyed, in particular, by equity markets in the US. Africa saw the highest level of growth again at 10.7% from the previous year, while Latin America boasted a strong 8.9% outcome. The Asia-Pacific region and Europe followed, both on 8.2%, while North America noted growth of 8.1%.

In terms of the regional concentration of financial wealth, the Asia-Pacific region comes in at number one, totalling $18.8 trillion, followed by North America, at $18 trillion. Europe, Latin America, the Middle East and Africa recorded total wealth levels of $14.7 trillion, $8 trillion, $2.4 trillion and $1.5 trillion respectively.Notable markets with strong HNWI growthSome markets saw stronger growth than others. In Russia, for instance, a massive boom in property prices saw the population of HNWIs grow by almost 20%, while the Netherlands saw the number increase by 13.7%. Growth in France of HNWI, at 10.7%, saw the country surpass the UK in terms of the total number. In the Asia Pacific, Indonesia, Thailand and Taiwan each saw above average growth in the number of members to the rich class, while  above average results were recorded in Canada and Brazil too, the latter due to strong performances in the country’s equity and housing markets.Largest HNWI populationsIn terms of the total number of HNWIs, the US remains number 1, totalling almost 480,000 , while Japan takes the number two spot with almost 290,000. Germany and China are a distant third and fourth respectively at 128,000 and 112,000 each.

The latest result shows considerable concentration of HNWI in the US, Japan, Germany and China, which cumulatively represent 61.2% of the total, up from 58.4% in 2012. The growth of HNWI in the top four markets continues to outstrip the wider market, as 680,000 were added to the top itself, while the rest of the world saw a total of 1.15 million additions.

The boost from the Russian property market has seen it move up one spot, while Saudi Arabia continues to face challenges from low commodity prices. Norway moves ahead of Hong Kong, while Mexico falls one spot following a 2% decline in the total number of HNWIs in the country.
Global HNWI wealth and number growthWhen it comes to the addition of new wealth, the ultra-high-net-worth-individuals, those with more than $30 million in liquid assets, saw the biggest gain in their number and wealth respectively, up 8.3% to 157,000 and 9.2% in wealth to 34.5% of total wealth in the group. The segment comprises 1% of the total number of people in the HNWI group.

Mid-tier Millionaires saw their numbers increase by 7.9%, while their total wealth grew by 7.9% on average to 22.5% of total HNWI wealth. The millionaires group grew by 7.4%, while total wealth came in at 43% of the total HNWI pie.

Following the completion of projects that are currently underway, HNWI total wealth will hit $100 trillion in 2025, up from $16.6 trillion in 1996. While promising for the wealthy sections of society, these numbers nevertheless raise concerns surrounding growing wealth and income inequality.

* Thus, not their primary residence, collectables, consumables and consumer durables.

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