The number of millionaires around the world held flat last year, but their overall wealth declined, according to tech consultant Capgemini and partner RBC Wealth Management in a joint World Wealth Report released this week.
And for the first time ever, the Asia-Pacific region surpassed North America last year as the region with the largest number of millionaires, Capgemini and RBC said in unveiling their 2012 World Wealth Report findings at the Harvard Club in New York on Tuesday.
The total of Asia-Pacific high-net-worth individuals, defined as people with investable assets of $1 million or more, expanded 1.6% to 3.37 million last year. This compares with North America’s HNWI population of 3.35 million.
“While more people surpassed the $1 million disposable income level in 2011, the aggregate wealth of high net worth individuals declined overall, as market volatility took its toll,” said George Lewis, group head of RBC Wealth Management, in a statement. “For the first time this year there are now more high-net-worth individuals in Asia-Pacific than in any other region.”
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However, India as well as Hong Kong topped the list of countries losing high-net-worth individuals in 2011, with India’s population of HNWIs dropping 18.0% to 125,500 from 153,000. Equity-market capitalization contributed to India’s plunge, wiping out asset values and levels of investable wealth. A similar stock-market decline in Hong Kong helped to reduce that HNWI population by 17.4%.
Losses in these two key markets meant that wealth contracted in Asia-Pacific overall in 2011 even though the number of millionaires in that region grew, Lewis noted. South Korea, for example, moved up in the rankings to replace India in the No. 12 spot for countries with the most millionaires.
So where are today’s high-net-worth individuals most likely to be found? Keep reading to learn about the top 10 countries for millionaires.
Read the results from last year’s CapGemini World Wealth Report at AdvisorOne.
Despite Italy’s persistent eurozone troubles, the country still ranks among the top 10 for millionaires, according to Capgemini/RBC.
So while Italy has a public debt to GDP ratio of 120.1%, the country remained home to 168,000 millionaires in 2011. To be sure, their numbers have fallen off. In 2010, there were 170,000 Italy-based millionaires, showing a 1.3% year-over-year drop.
“We expect market volatility will remain in 2012 as European leaders deal with their debt crisis,” said RBC group leader Lewis at the Harvard Club unveiling of the World Wealth Report.
Australia is the ninth-ranked country for HNWI populations, with 179,500 millionaires in 2011. That compares with 192,900 in 2010, for a 6.9% loss in Australia’s millionaire population.
Worldwide, the global HNWI population grew by only 0.8% to 11 million in 2011 after growth of 8.3% in 2010, according to CapGemini/RBC. Most of this growth can be attributed to HNWIs in the $1 million to $5 million range, whose numbers grew 1.1% to represent 90% of the global HNWI population. In contrast, wealth among the world’s HNWIs in 2011 fell by 1.7% to $42.0 trillion versus 9.7% growth to $42.7 trillion in 2010.
As for the global population of ultra-HNWIs, those with investable assets of more than $30 million declined by 2.5% in 2011. Wealth among this group declined by 4.9% after increasing by 10.2% in 2010.
Not surprisingly, Switzerland, that bastion of stability, has held on to its ranking among the world’s top 10 countries for millionaires. Indeed, Switzerland has seen its population of high-net-worth individuals grow in the last year.
Capgemini/RBC reports that Switzerland’s number of HNWIs grew by 3.6% in 2011 to 252,000 individuals versus 243,000 in 2012. The country enjoys a public debt to GDP ratio of 48.6% (compare that to the United States’ 98.5%), and the public budget balance represents only 0.4% of GDP.
The Capgemini/RBC World Wealth Report’s growth outlook for North America is “cautiously optimistic,” and that applies to Canada as well as the United States. Indeed, Canadian real GDP growth is expected to surpass that of the United States in 2013, at 2.2% for Canada versus 2.1% in the U.S.
As of the end of 2011, Canada was home to 280,000 millionaires, just 0.9% less than the population of 282,000 HNWIs in 2010.
Former President Nicolas Sarkozy’s pro-capitalist policies may have lost to Socialist François Hollande’s anti-austerity platform in France’s May elections, but high-net-worth individuals nevertheless keep la belle France firmly rooted among those nations with the largest number of millionaires.