By Reico Wong

Singapore triumphed Hong Kong as Asia's home for the wealthy, even as the number of high- net-worth individuals here fell 7.8 per cent to 91,200 last year.

Meanwhile, the Asia-Pacific became the region with the largest number of rich individuals for the first time, according to a study conducted by consultancy firm Capgemini and the Royal Bank of Canada's (RBC's) wealth-management arm.

Singapore's 40 richest 2011 Click on thumbnail to view. Source: Forbes Asia Legend: : up        : down       : new        : returnee       : unchanged

The World Wealth Report, released yesterday, tracked the number of individuals with investable assets of at least US$1 million (S$1.3 million), excluding their primary homes, collectables and consumer durables.

The population of high- net-worth individuals in Hong Kong saw a much steeper decline of 17.4 per cent to 83,600 last year.

Widespread volatility over the euro zone's debt crisis took its toll on the wealthy, said Mr Barend Janssens, the head of wealth management for emerging markets at RBC.

"Several factors challenged Singapore's rich last year, in particular the 7.6 per cent drop in stock-market capitalisation and inflation hitting a 25-month high of 5.5 per cent," he said.

"However, keeping in mind the fact that the World Wealth Report works on the basis of conversion to the US dollar, the Singapore dollar's relative strength to the greenback helped to mitigate the negative effect."

Declining stock markets hit the rich in Hong Kong much harder than those in Singapore, as most of them tended to have a larger proportion of their wealth locked in equity.

On the whole, the number of high-net-worth individuals in the Asia-Pacific grew 1.6 per cent, to 3.37 million last year.

This pushed it to become the region with the largest population of high-net-worth individuals

in the world for the first time, surpassing even North America with its 3.35 million.

The report also found that there were 22,000 ultra-high- net-worth individuals, or those with investable assets of US$30 million or more, in the Asia-Pacific last year. Such individuals accounted for 0.6 per cent of the rich in the region.

On a country-specific basis, the United States, Japan and Germany retained the biggest share of the wealthy last year.

The three countries together have 53.3 per cent of the world's rich, up slightly from 53.1 per cent in 2010.

Still, North America remained the largest region when it came to the size of high-net- worth individuals' wealth.

The size of the wealth there was US$11.4 trillion last year, while the Asia-Pacific came in second with US$10.7 trillion.

Commenting on the findings, Mr Janssens said the Asia Pacific is likely to "permanently" occupy the top of the rankings in terms of the population of high- net-worth individuals.

But he did not think that the region would overtake North America when it came to the size of high-net-worth individuals' wealth.

"The gap is unlikely to narrow in the near future as the North American rich tend to place more of their investable assets in equities - approximately 33 per cent, compared to 26 per cent for those in the Asia-Pacific," he said.

"So when equities recover, the lead that the North Americans have over their Asian counterparts will expand."

He added that as the European crisis continues, China and Japan appear to offer the most attractive investment opportunities.

"Investment strategies are likely to remain quite conservative," he said.

"High-net-worth individuals will need to prepare themselves for ongoing market volatility... with returns likely to be extremely positive or extremely negative, rather than equally distributed."

reicow@sph.com.sg

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