New-Gen entrepreneurs fuel millionaire households

The population of newly minted millionaires across Asian-Pacific nations has swelled to 4.69 million, bringing the grand total a hair above North America’s millionaires club, according to a new survey of the world’s high net worth individuals.
Capgemini and RBC Wealth Management surveyors estimate that the global economy produced 920,000 newly minted millionaires last year, who they define as anyone with investable assets exceeding $1 million in value.
Asia-Pacific led the world with 8.5% growth in the population of millionaires, followed by North America’s 8.3%.
While the cumulative wealth of North America’s millionaires still led the world with $16.23 trillion in holdings, the study estimates that Asian-Pacific millionaires will hold a greater sum by the end of this year.
New millionaires in China and India have also helped propel the combined wealth of Asia Pacific’s richest individuals past their peers in Europe.
New “millionaire households” were also created more quickly in Asia Pacific than anywhere else, according to the Boston Consulting Group’s (BCG) annual global wealth report, as the world’s 17m households worth more than $1m grew richer once again during 2014.
For the first time in the survey’s 15-year history, the Asia Pacific region – which for the purposes of this report excludes Japan – overtook Europe to become the world’s second wealthiest region, with $47tn in private wealth, up 29% on 2013. North America, where private wealth totals $50.8tn, remains the wealthiest region, but it will be surpassed next year when the wealth of Asia Pacific’s so-called “high net worths” reaches $57tn, the survey predicts.
A booming equity market helped all wealthy individuals in 2014, but Asia had the added benefit of the fortunes being created by a new generation of entrepreneurs, such as Jack Ma of Chinese e-commerce firm Alibaba and Indian property tycoon Jitendra Virwani. The report’s authors said Asia’s lead in growth will be exaggerated in future years, as they expect stock markets to slow.
Daniel Kessler, global leader of BCG’s wealth management division, said: “We have seen a really strong equity market that has had a very strong effect on existing assets. But looking forward, we assume a moderation in the market performance, with the main difference the newly created wealth in Asia. Two-thirds of the growth in Asia-Pacific is coming from entrepreneurs. We expect Asia-Pacific to add $27.8tn [to the wealth of the region’s richest] over the next five years, of which 70% will be China and 15% India.”
The data also showed another profitable year for the world’s ultra-rich as a whole, with the group’s total wealth growing by 12% to $164tn - about 10 times the size of the annual GDP of the United States.
In the UK, the number of households worth more than $1m grew by 7% in 2014 to 730,000 – with 1,019 worth more than $100m – while the country’s private financial wealth rose by 11.5% to $9.7tn on the back of the decent performance by equities and bonds.
The United States has the most households worth more than $100m with 5,201, ahead of China in second place with 1,037 households, the UK in third, and India in fourth with 928. All retain the same rankings on the ultra-high net worth list as in 2013.

Global profile of millionaire households

Millionaire households represented just 0.9 percent of all households but owned 39 percent of global wealth, up from 37 percent in 2009. The number of millionaire households increased by 12.2 percent in 2010 to about 12.5 million.
The United States had by far the most millionaire households (5.2 million), followed by Japan, China, the United Kingdom, and Germany.
Singapore continued to have the highest concentration of millionaire households, with 15.5 percent of all households having at least $1 million in AuM. Switzerland had the highest concentration of millionaire households in Europe and the second-highest overall, at 9.9 percent.
Three of the six densest millionaire populations were in the Middle East—in Qatar, Kuwait, and the United Arab Emirates.
The proportion of wealth owned by millionaire households increased the most in Asia-Pacific, at 2.9 percentage points, followed by North America, at 1.3 percentage points.
The country with the fastest-growing number of millionaire households was Singapore, with 170,000—up nearly a third from 2009.