China’s wealth management industry to grow by 9.5% annually over next four years: report

Wealth management industry in China is growing at the rate of 9.5% per annum, which will maintain its development pace during the forecast period (2012-16), according to a BRICdata report.

The robust performance of Chinese GDP has made it one of the most favorable investment destinations for wealth management firms across the globe.

The report highlights that during the projected period (2012-16), Chinese wealth management will continue to grow rapidly, backed by large and young affluent customer base, an improving wealth situation among the global Chinese population, and an increasing share of organized companies as compared to the unorganized workforce.

According to the report, during the projected period, the wealth and volume of HNWIs in the country is anticipated to grow strongly, which will touch 2.4 million individuals by 2016.

The strong base of China’s HNWIs prepares a fertile ground for the country’s wealth management firms and private banks, as there is currently a relatively low penetration of financial services in China.

During the review period (2007-2011), China witnessed a robust compound annual growth rate (CAGR) of 8.96%, while the total wealth of China’s HNWIs recorded a CAGR of 9.77% during the review period, claims the report.

The report underlines that the attractiveness of alternative asset holdings has rose dramatically over the past two years, which is expected to continue into the forecast period and help the share of alternatives within total HNWI assets to increase from 4.7% in 2011 to 8.5% in 2016.

The report points out that there are huge opportunities for the commercial banks, private wealth management companies and asset management companies, as China is still an untapped market compared to its vast population and growing development.

The most important aspect of Chinese growth is that the country successfully averted the global financial crisis without affecting its growth rate, while rest of the world was trying to keep their head over the water.

The full report ‘Emerging Opportunities in the Chinese Wealth Management Industry: Market Size, Strategies, Products and Competitive Landscape’ is available from BRICdata. Click here for more details.