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Strong returns lift high net worth individuals' wealth globally

STRONG investment performance buoyed the wealth of high net worth individuals globally, driving a global wealth expansion of 8.2 per cent in 2016, despite a slight deceleration in the Asia-Pacific.

The portion of wealth managed by wealth managers appreciated by a robust 24.3 per cent average globally, Capgemini's 2017 World Wealth Report has found. In the Asia-Pacific, the appreciation is even more impressive at 33 per cent.

Singapore's HNWI, however, report a relatively more muted investment performance at about 18.2 per cent. This may partly explain Singapore's negative net promoter score (NPS) of minus 11, compared to 31.4 in the Asia-Pacific, and 45.2 in North America. Japan's net promoter score is the lowest at minus 51.3, which dragged the global score down to 11.6.

The number of HNWI globally is 16.5 million and they hold an estimated wealth of US$63.5 trillion. In the Asia-Pacific, there around 5.5 million HNWI, with wealth of roughly US$18.8 trillion. The NPS is a measure of the likelihood that a client would recommend a wealth manager.

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The Asia-Pacific remains the world's largest HNWI market, even though its wealth growth was a tad slower at 8.2 per cent compared to 9 per cent in 2015.

The Asia-Pacific's market growth was dimmed by sharp equity market declines in Japan and China. The latter two markets were major drivers of HNWI growth in the past. China's market capitalisation fell 10 per cent, and it grew modestly in Japan.

Capgemini's David Wilson, head of Asia wealth management, said: "The Asia-Pacific still turned in a solid performance. This is less about Asia slowing, and more about North America and Europe having caught up in 2016."