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Ultra HNWIs in China 2015
© WealthInsight. This report is a licensed product and is not to be photocopied.
Publication date: May 2015
Report code: WI0348MR
www.wealthinsight.com
Ultra HNWIs in China 2015
Beijing • Buenos Aires • Frankfurt • Hong Kong • Hyderabad • London • Madrid • Mexico City • New York • San Francisco • Seoul • Shanghai • Singapore • Sydney
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Ultra HNWIs in China 2015
© WealthInsight. This report is a licensed product and is not to be photocopied.
About WealthInsight
The WealthInsight Intelligence Center Database is an unparalleled resource, and is the leading one of
its kind. Compiled and curated by a team of expert research specialists, the database comprises
dossiers on over 125,000 HNWIs from around the world.
The Intelligence Center also includes the tracking of wealth and liquidity events as they happen, as
well as detailed profiles of major private banks, wealth managers and family offices in each market.
With the database as the foundation for its research and analysis, WealthInsight is able to obtain an
unsurpassed level of granularity, insight and authority on the HNWI and wealth management universe
in each of the countries and regions it covers.
TABLE OF CONTENTS
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Ultra HNWIs in China 2015
© WealthInsight. This report is a licensed product and is not to be photocopied.
TABLE OF CONTENTS
1 Introduction ........................................................................................................ 2
1.1 Details of this Report ............................................................................................................... 2
1.2 Definitions ................................................................................................................................ 3
2 About WealthInsight .......................................................................................... 7
TABLE OF CONTENTS
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Ultra HNWIs in China 2015
© WealthInsight. This report is a licensed product and is not to be photocopied.
LIST OF TABLES
Table 1: HNWI Wealth Band and Group Definitions................................................................................................ 4 Table 2: Regions in China by Population (Volume), 2014 ..................................................................................... 11 Table 3: Chinese HNWIs – Volume Distribution (%), 2014 ................................................................................... 18 Table 4: Chinese HNWIs – Wealth Distribution Wealth Pyramid (%), 2014 .......................................................... 19 Table 5: Chinese HNWIs – Industry Performance, 2010–2014 ............................................................................. 23 Table 6: Chinese HNWIs – Cities, 2014 ................................................................................................................ 24 Table 7: Chinese HNWI Growth in Top Cities (Thousand), 2010–2014 ................................................................ 26 Table 8: Chinese HNWI Population Density in Major Cities (Thousand), 2014 ..................................................... 27 Table 9: Chinese HNWIs in Top Cities (Thousand), 2010–2019 ........................................................................... 29 Table 10: Chinese HNWIs – Growth Rates for Top Cities (%), 2010–2019 .......................................................... 30 Table 11: Chinese UHNWI Gender Performance (%), 2010–2014 ....................................................................... 34 Table 12: Chinese UHNWI Source of Wealth (%), 2014 ....................................................................................... 35 Table 13: Chinese Volume of UHNWI in Top Cities, 2010–2019 .......................................................................... 37 Table 14: Chinese UHNWI Growth Rates in Top Cities (%), 2010–2019 .............................................................. 37 Table 15: Chinese Billionaires Market Overview (Volume and US$ Billion), 2010–2019 ...................................... 38 Table 16: Chinese Top 10 Billionaires (US$ Billions), 2014 .................................................................................. 40 Table 17: Chinese Billionaire Wealth Growth (US$ Billion), 2010−2014 ............................................................... 40 Table 18: Chinese Centimillionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 .................. 41 Table 19: Chinese Affluent Millionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ............. 43 Table 20: Chinese Mid-Tier Millionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ............ 46 Table 21: Chinese Lower-Tier Millionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ........ 48 Table 22: Chinese Allocations of HNWI Assets (%), 2010–2019 .......................................................................... 51 Table 23: Chinese HNWI Holdings Growth (%), 2010–2019 ................................................................................. 52 Table 24: Chinese HNWI Alternative Asset Composition (%), 2010–2019 ........................................................... 53 Table 25: Chinese HNWI Trends of Investments in Alternative Assets (%), 2010–2019 ...................................... 53 Table 26: Chinese Trends in ‘Art, Wine and Wheels’, 2010–2014 ........................................................................ 54 Table 27: Global Prime Real Estate Prices per m2 (US$), 2012 ........................................................................... 56 Table 28: Chinese HNWI Foreign Investment Allocations (%), 2010–2019 .......................................................... 60 Table 29: Chinese HNWI Liquidity Breakdown (US$ Billion), 2010–2019 ............................................................. 62 Table 30: Chinese HNWI Liquidity Breakdown (%), 2010–2019 ........................................................................... 63 Table 31: Chinese UHNWI Allocations and Share of HNWI Assets (%), 2014 ..................................................... 65 Table 32: Leading Domestic Private Banks in China by local AuM (US$ Million), 2014........................................ 68 Table 33: Leading Foreign Private Banks in China by local AuM (US$ Million), 2014 .......................................... 69 Table 34: Leading Wealth Managers in China by AuM (US$m), 2014 .................................................................. 70 Table 35: Wealth Management Industry – Recent Deal Activity in China, 2014/2014 .......................................... 72 Table 36: Chinese Income Tax Bands (RM), 2014–2014 ..................................................................................... 75 Table 37: CNY per US$ Exchange Rate, 2010–2019 ........................................................................................... 77 Table 38: Chinese Real GDP Growth (%), 2010–2019 ......................................................................................... 78 Table 39: Chinese GDP per Capita (US$), 2010–2019 ......................................................................................... 79 Table 40: Chinese Domestic Market Capitalization (US$ Billion), 2010–2014 ...................................................... 80 Table 41: Chinese Commodity Indices, 2010–2019 .............................................................................................. 81 Table 42: Chinese Foreign Direct Investment (US$ Billion), 2007–2011 .............................................................. 82 Table 43: Chinese Inflation Rate (%), 2010–2019................................................................................................. 83 Table 44: Chinese Money Market Rate (%), 2010–2019 ...................................................................................... 84 Table 45: Chinese Balance of Payments (US$ Billion), 2010–2014...................................................................... 85 Table 46: Chinese Government Debt as a Percentage of GDP, 2010–2019 ........................................................ 86 Table 47: Chinese Stock Market Performance, 2010–2014 .................................................................................. 87 Table 48: Chinese HNWI Wealth vs GDP Ratio, 2010–2019 ................................................................................ 88 Table 49: China – Appendix One .......................................................................................................................... 89 Table 50: China – Appendix Two .......................................................................................................................... 90
TABLE OF CONTENTS
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Ultra HNWIs in China 2015
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LIST OF FIGURES
Figure 1: HNWI Wealth Band Definitions ................................................................................................................ 5 Figure 2: Map of China ............................................................................................................................................ 6 Figure 3: Chinese Asset Price Performance (%), 2010–2014 ............................................................................... 14 Figure 4: Chinese HNWI Performance (US$ Billions and HNWI Volume), 2010–2019 ......................................... 15 Figure 5: Chinese vs Global HNWIs (%), 2010–2019 ........................................................................................... 16 Figure 6: Chinese HNWIs – Growth Factor Correlation, 2010–2014..................................................................... 17 Figure 7: Chinese HNWIs – Wealth Pyramid (Volume Distribution), 2014 ............................................................ 18 Figure 8: Chinese HNWIs – Wealth Pyramid (Volume Distribution), 2014 ............................................................ 19 Figure 9: Chinese HNWIs – Age Distribution (%), 2014 ........................................................................................ 20 Figure 10: Chinese HNWIs – Job Titles (%), 2010–2014 ...................................................................................... 21 Figure 11: Chinese HNWIs – Distribution by Industry (%), 2014 ........................................................................... 22 Figure 12: Chinese HNWIs – City Performance (%), 2010–2014.......................................................................... 25 Figure 13: Chinese HNWIs – Volume of HNWIs by City (Thousand), 2010 and 2014 .......................................... 26 Figure 14: Chinese HNWIs – City Forecasts (%), 2015–2019 .............................................................................. 28 Figure 15: Chinese Volume of HNWI by City (Thousand), 2014–2019 ................................................................. 29 Figure 16: Chinese UHNWI Wealth Share vs Volume Growth (%), 2010–2014 ................................................... 31 Figure 17: Chinese UHNWI Volume by Wealth Band (Thousand), 2010–2019 .................................................... 32 Figure 18: Chinese UHNWI Wealth by Wealth Band (US$ Billion), 2010–2019 .................................................... 33 Figure 19: Chinese UHNWI Age Distribution (Percentage Share), 2014 .............................................................. 35 Figure 20: Chinese UHNWI Distribution by Industry (%), 2014 ............................................................................. 36 Figure 21: Chinese Billionaires Market Overview (Volume and US$ Billion), 2010–2019 ..................................... 38 Figure 22: Chinese Centimillionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ................. 41 Figure 23: Chinese Affluent Millionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ............ 43 Figure 24: Chinese Mid-Tier Millionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ........... 46 Figure 25: Chinese Lower-Tier Millionaires Market Overview (Volume and US$ Million/Billion), 2010–2019 ....... 48 Figure 26: Chinese HNWI Asset Class Composition (%), 2010–2019 .................................................................. 50 Figure 27: Chinese HNWI Trends in Alternative Assets (US$ Billion), 2010–2019 ............................................... 53 Figure 28: Chinese Trends in ‘Art, Wine and Wheels’, 2010–2014 ....................................................................... 54 Figure 29: Chinese HNWI Foreign Investment Allocation and Growth (%), 2014 ................................................. 59 Figure 30: Chinese HNWI Global Distribution of Foreign Investments (%), 2010–2019 ....................................... 60 Figure 31: Chinese HNWI Liquidity Breakdown (%), 2010–2019 .......................................................................... 63 Figure 32: Chinese UHNWI Asset Class Composition (%), 2010–2019 ................................................................ 64 Figure 33: Chinese Wealth Management Industry – Maturity Level of Operators, 2014 ....................................... 73 Figure 34: Chinese Wealth Management Industry Behavioral Mapping, 2014 ...................................................... 74 Figure 35: CNY to US$ Exchange Rate, 2010–2019 ............................................................................................ 77 Figure 36: Chinese Real GDP Growth (%), 2010–2019 ........................................................................................ 78 Figure 37: Chinese GDP per Capita (US$), 2010–2019 ....................................................................................... 79 Figure 38: Chinese Domestic Market Capitalization (US$ Billion), 2010–2014 ..................................................... 80 Figure 39: Chinese Commodity Indices, 2010–2019 ............................................................................................. 81 Figure 40: Chinese Foreign Direct Investment (US$ Billion), 2007–2011 ............................................................. 82 Figure 41: Chinese Inflation Rate (%), 2010–2019 ............................................................................................... 83 Figure 42: Chinese Money Market Rate (%), 2010–2019 ..................................................................................... 84 Figure 43: Chinese Balance of Payments (US$ Billion), 2010–2014 .................................................................... 85 Figure 44: Chinese Government Debt as a Percentage of GDP, 2010–2019 ....................................................... 86 Figure 45: Chinese Stock Market Performance, 2010–2014 ................................................................................. 87 Figure 46: Chinese HNWI Wealth vs GDP Ratio, 2010–2019 ............................................................................... 88 Figure 47: Chinese HNWIs – Volume by Wealth Band, 2010–2019 ..................................................................... 91 Figure 48: Chinese HNWIs – Wealth by Wealth Band (US$ Billion), 2010–2019.................................................. 91 Figure 49: Chinese HNWIs – Wealth per Capita (US$ Million), 2010–2019 .......................................................... 92
ABOUT WEALTHINSIGHT
1 Introduction
1.1 Deta i ls o f th is Repor t
This report is the result of WealthInsight’s extensive research into the high net worth
individual (HNWI) population and wealth management industry in China.
The report focuses on HNWI performance between the end of 2010 and the end of
2014, providing a clear understanding of how well the country’s HNWIs performed
during the financial crisis.
For the purposes of this report, the phrase ‘coverage period’ refers to 2010–2019, while
the ‘review period’ covers 2010–2014 and the ‘forecast period’ covers 2014–2019.
The report reviews the performance and asset allocations of Chinese HNWIs and
UHNWIs and highlights the top-performing cities. It also includes an evaluation of the
local wealth management industry.
This report categorizes the HNWI population across five wealth bands, as defined in
Table 1.
Chinese HNWIs include all individuals permanently living in China, as well as Chinese-
born individuals who have chosen to live elsewhere but still operate businesses in the
country.
For the purposes of this report, wealth is defined as the net value of assets, which
includes both financial holdings and tangible assets. This comprises alternative assets,
real estate (excluding the primary residence), cash and deposits, fixed-income, equities
and business interests.
The demographic details in this study are based on a sample of 3,565 Chinese HNWIs
from the WealthInsight database.
ABOUT WEALTHINSIGHT
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Ultra HNWIs in China 2015
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1.2 Def in i t ions
‘Wealth management’ is defined as the provision of banking services to wealthy
individuals and their families. It generally involves the management of trusts and
inheritance, and the allocation of client funds.
A ‘private bank’ is defined as a division of the banking group that provides wealth
management services.
A ‘wealth manager’ is defined as a specialist wealth management service provider.
A ‘family office’ is defined as a wealth management company that focuses on a single
HNWI or a small group of selected HNW clients.
‘Investable assets’ include all assets except business interests, whereas ‘liquid assets’
are defined as all assets that can be immediately cashed in.
ABOUT WEALTHINSIGHT
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Table 1: HNWI Wealth Band and Group Definitions
Wealth Band Definition
Billionaires
Billionaires are HNWIs with wealth of US$1 billion or more, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
Centimillionaires
Centimillionaires are HNWIs with wealth of between US$100 million and less than US$1 billion, including equities, bonds, cash and deposits, fixed-income products real estate (excluding primary residence), alternative assets and business interests.
Affluent Millionaires
Affluent millionaires are HNWIs with wealth of between US$30 million and less than US$100 million, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
Mid-Tier Millionaires
Mid-tier millionaires are HNWIs with wealth of between US$5 million and less than US$30 million, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
Lower-Tier Millionaires
Lower-tier millionaires are HNWIs with wealth of between US$1 million and less than US$5 million, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
Wealth Group Definition
HNWIs
The HNWI wealth group comprises all studied wealth bands. It represents those individuals with wealth of US$1 million or more, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
UHNWIs
The UHNWI wealth group comprises the billionaire, centimillionaire and affluent millionaire wealth bands. It represents those individuals with wealth of US$30 million or more, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
Core HNWIs
The core HNWI group comprises the mid-tier millionaire and lower-tier millionaire wealth bands. It represents those individuals with wealth of between US$1 million and less than US$30 million, including equities, bonds, cash and deposits, fixed-income products, real estate (excluding primary residence), alternative assets and business interests.
Source: WealthInsight © WealthInsight
ABOUT WEALTHINSIGHT
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Ultra HNWIs in China 2015
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Figure 1: HNWI Wealth Band Definitions
Source: WealthInsight © WealthInsight
ABOUT WEALTHINSIGHT
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Ultra HNWIs in China 2015
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Figure 2: Map of China
Source: CIA Factbook © WealthInsight
ABOUT WEALTHINSIGHT
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Ultra HNWIs in China 2015
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2 About WealthInsight
WealthInsight provides detailed data and insightful analysis on the world’s HNWI and wealth
sector. With decades of experience providing business information, WealthInsight helps
organizations to make informed decisions and win new business.
At WealthInsight’s core is its proprietary HNWI Database of the world’s wealthiest
individuals. Around this database WealthInsight has built a number of valuable research-
based products and services that make WealthInsight much more than just a rich contact list.
WealthInsight works with and provides solutions for:
Wealth managers
Private banks
Family offices
Technology providers
Professional services – consultants, accountants, lawyers and real estate professionals
Fund managers, hedge fund managers, asset managers, venture capitalists
Non-profit and educational institutions
WealthInsight’s corporate headquarters are located in London, with offices in New York, San
Francisco, Sydney, Seoul and Hong Kong.
For more information on WealthInsight please visit www.wealthinsight.com
Reports
WealthInsight publishes high-quality research reports focused on the wealth sector. The
reports provide comprehensive analysis of countries, regions and special topics.
With the HNWI Database as the foundation for its primary research and analysis,
WealthInsight is able to obtain an unsurpassed level of granularity, insight and authority on
the HNWI universe in each of the countries and regions covered.
All reports are available as a part of the WealthInsight Intelligence Centre. Reports can also
be purchased on a subscription or one-off basis.
ABOUT WEALTHINSIGHT
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Ultra HNWIs in China 2015
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Every WealthInsight report is uniquely formulated for the region, country or topic covered.
Key features of the reports include:
Market sizing
Forecasting
Benchmarking
HNWI asset allocation
Behavioral mapping
Family offices
Methodology
WealthInsight’s teams of in-house analysts devise and collect data over a historical period of
five years and develop forecasts for a five-year forecast period. All WealthInsight wealth
reports are rigorously sourced and created according to a comprehensive methodological
process:
Internal audit
Review of in-house databases to gather existing data:
Historic market databases and reports
HNWI Database
Wealth management, private bank and family office database
Financial deals and news archive
Secondary research
Collection of the latest market-specific data from a wide variety of industry sources:
Government statistics
Industry associations
Company filings
Broker reports
International organizations
ABOUT WEALTHINSIGHT
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Primary research
Review of the latest wealth management and private banking industry trends
Surveys using panels compiled from across the wealth sector
Wealth management and private banking professionals
Financial services experts
HNWIs
Expert opinion
Collation of opinion taken from WealthInsight interviews of leading industry experts
Analysis of third-party opinion and forecasts
Broker reports
Industry associations
Wealth management and private banking media
Official government sources
Leading academic research and commentary
Data consolidation and verification
Consolidation of data and opinion to create historical datasets
Creation of models to benchmark data across sectors, asset classes and geographies
Market forecasts
Feed of forecast data into market models:
Macroeconomic indicators
Industry-specific drivers
Analysis of the WealthInsight HNWI Database and Wealth sector company databases
to identify key trends
Latest wealth trends
Key drivers of the wealth management industry
ABOUT WEALTHINSIGHT
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Report writing
Analysis of market data
Discussion of company and industry trends and issues
Integration of survey results
Annual review of financial deals and wealth management trends
Standardization of market definitions using recognized industry classifications
Quality control
Peer review
Senior-level QC
Random spot checks on data integrity
Benchmark checks across databases
Market data cross-checked for consistency with accumulated data
Internal databases
Company filings
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Disclaimer
All Rights Reserved.
The facts of this report are believed to be correct at the time of publication but cannot be guaranteed.
Please note that the findings, conclusions and recommendations that WealthInsight delivers will be
based on information gathered in good faith from both primary and secondary sources, whose
accuracy we are not always in a position to guarantee. As such WealthInsight can accept no liability
whatever for actions taken based on any information provided herein.
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Ultra HNWIs in China 2015
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