Executive summary

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Scope

• The report features:
• Independent market sizing of Australia’s HNWIs
• Most up to date and thorough analysis of the demographic breakdown of Australia’s HNWIs
• Volume, wealth and allocation trends from 2007 to 2011
• Volume, wealth and allocation forecasts to 2015
• City specific ratings and breakdowns of wealth, wealth growth and industries that HNWIs work in for each city
• Details of the development, challenges and opportunities of the Wealth Management and Private Banking sector in Australia
• Insights into the drivers of HNWI wealth
• Detailed family office information and trends from 2007 to 2011

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Key highlights

• There are just over 274,000 HNWIs in Australia, with an average wealth of US$3.1 million per person and a combined wealth of US$845 billion.
• The number of Australia’s HNWIs increased by 8.9% (2.2% pa) over the review period (2007-2011), while total wealth grew by 0.9% (0.2% pa).
• Australian HNWI volumes and wealth were positively influenced by a significant 44% rise in US dollar per capita GDP levels, which rose from US$46,000 in 2007 to US$66,000 in 2011. This in turn was influenced by a significant 19% appreciation of the Australian dollar against the US dollar over the review period.
• The number of Australian HNWIs is expected to rise by 20% (4.7% pa) from 2011 to reach over 330,000 individuals by 2015, while HNWI wealth will grow by 26% (6.0% pa) to reach US$1.1 trillion in 2015. Most of the growth in wealth will be driven by the lower-tier millionaires, whose wealth is expected to rise by over 33%.
• Adelaide experienced the strongest UHNWI growth over the period from 2007 to 2011, with growth of 75%, followed by Perth with 52%.
• Australia is one of the largest private banking centres in Asia, with AuM of US$350 billion. The local market is dominated by local wealth managers and family offices. The single family office segment alone constitutes over US$180 billion in AuM.

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Reasons to buy

• The WealthInsight Intelligence Center Database is an unparalleled resource and the leading resource of its kind. Compiled and curated by a team of expert research specialists, the database comprises up to one hundred data-points on over 100,000 HNWIs from around the world. It also includes profiles on major private banks, wealth managers and family offices in each country. With the database as the foundation for our research and analysis, we are able obtain an unsurpassed level of granularity, insight and authority on the HNWI and wealth management universe in each of the countries and regions we cover
• Comprehensive forecasts to 2015
• Information on sources of wealth for HNWIs in each major city, by industry and other measures

Table of contents

1 Introduction
1.1 What is this Report About?
2 Executive Summary
3 Wealth Sector Fundamentals
3.1 Political Background of the Wealth Sector
3.2 Economic Background to the Wealth Sector
3.3 Benchmarking Australian Wealth in Context
3.3.1 Distribution of Wealth
4 Findings from the WealthInsight HNWI Database
4.1 Trends in HNWI Wealth to 2015
4.1.1 HNWI Trend Analysis
4.1.2 HNWI Volume Trend Analysis
4.1.3 HNWI Wealth Trend Analysis
4.1.4 HNWIs – Per Capita Net Worth Trend Analysis
4.1.5 HNWIs – Trends of the Wealth Bands
4.2 UHNWIs
4.2.1 UHNWI Volume Trend Analysis
4.2.2 UHNWI Wealth Trend Analysis
4.2.3 UHNWI Per Capita Net Worth Trend Analysis
4.2.4 UHNWIs: demographic breakdown
4.2.5 UHNWIs: demographic breakdown by age
4.2.6 UHNWIs – Job Titles
4.2.1 UHNWIs – Sources of wealth
4.2.2 UHNWIs – Industry performance
4.2.3 UHNWIs – Importance of Entrepreneurship
4.2.4 UHNWIs – demographic breakdown by region
4.2.5 UHNWIs – State and city performance
4.2.6 UHNWIs – Forecasts
4.2.7 UHNWIs – WealthInsight ratings
4.3 UHNWIs – Billionaires
4.3.1 Billionaire Volume Trend Analysis
4.3.2 Billionaire Wealth Trend Analysis
4.3.3 Billionaire Per Capita Net Worth Trend Analysis
4.4 UHNWIs – Centimillionaires
4.4.1 Centimillionaire Volume Trend Analysis
4.4.2 Centimillionaire Wealth Trend Analysis
4.4.3 Centimillionaire Per Capita Net Worth Trend Analysis
4.5 UHNWIs – Affluent Millionaires
4.5.1 Affluent Millionaire Volume Trend Analysis
4.5.2 Affluent Millionaire Wealth Trend Analysis
4.5.3 Affluent Millionaire Per Capita Net Worth Trend Analysis
4.6 Core HNWIs
4.6.1 Core HNWI Volume Trend Analysis
4.6.2 Core HNWI Wealth Trend Analysis
4.6.3 Core HNWI Per Capita Net Worth Trend Analysis
4.7 Core HNWIs – Mid-tier Millionaires
4.7.1 Mid-tier Millionaire Volume Trend Analysis
4.7.2 Mid-tier Millionaire Wealth Trend Analysis
4.7.3 Mid-tier Millionaire Per Capita Net Worth Trend Analysis
4.8 Core HNWIs – Lower-tier Millionaires
4.8.1 Lower-tier Millionaire Volume Trend Analysis
4.8.2 Lower-tier Millionaire Wealth Trend Analysis
4.8.3 Lower-tier Millionaire Per Capita Net Worth Trend Analysis
5 Analysis of Australian HNWI Investment
5.1 Analysis by Asset Classes
5.1.1 Trends in Liquid Assets – Equity, Fixed Income and Cash and Deposits
5.1.2 Trends in Alternative Assets
5.1.3 Trends in “Art, Wine and Wheels”
5.1.4 Trends of Investments in Real Estate
5.1.5 Trends of Investments in Cash and Deposits
5.1.6 Trends of Investments in Fixed Income
5.1.7 Trends of Investments in Equity
5.1.8 Trends of Investments in Business Interest
5.2 Analysis of Foreign Investments
5.2.1 Trend of Investments in Rest of Asia
5.2.2 Trend of Investments in North America and Europe
5.2.3 Trend of Investments in the Middle East and Latin America
6 Competitive Landscape of the Wealth Sector
6.1 Industry Structure
6.2 Family Offices
6.2.1 Multi-Family Offices
6.2.2 Single Family Offices
6.3 Leading Companies in the Wealth Management and Private Banking Industry
6.4 Wealth Management and Private Banking Industry – Behavioral Mapping
6.5 Porter’s Five Force Analysis – Wealth management industry
6.6 Financial Services Review
6.6.1 Foreign Banks
6.6.2 Domestic Banks
6.6.3 Superannuation funds
6.6.4 Hedge funds
6.6.5 REITs
6.6.6 Investment Management
6.6.7 Independent financial advisors
6.7 Challenges and Opportunities for the Wealth Sector in Australia
6.7.1 Regulatory Environment
6.7.2 Tax structure
6.7.3 Human resource availability for the wealth management industry
6.7.4 Philanthropy
6.7.5 Demand for Intergenerational Wealth Transfer and Younger Clientele
7 Appendix
7.1 Pertinent Regulations
7.1.1 Regulations on Banks
7.1.2 Regulations on Taxes
7.1.3 Regulations on Fund Management
7.1.4 Regulations on Foreign Investment
7.1.5 Regulations on Real Estate
7.1.6 Regulations on Foreign Investment in Real Estate
7.1.7 Regulations on Hedge Funds
7.1.8 Regulations on Wealth Management and Private Banking
7.1.9 Regulations Related to Investment and Employment
7.1.10 Regulations Related to Immigration
7.2 Additional case studies
7.2.1 Superannuation fund and insurance companies: An edge over others
7.3 Key Economic Trends and Drivers
7.3.1 AUD to USD Moving Annual Average Exchange Rate
7.3.2 Real GDP Growth
7.3.3 Per Capita GDP
7.3.4 Gross Savings Rate as a % of GDP
7.3.5 Domestic Market Capitalization
7.3.6 Housing Price Index
7.3.7 Commodity Index
7.3.8 Foreign Direct Investment
7.3.9 Investments of FII’s in Equity Products
7.3.10 Banking Indicators
7.3.11 Inflation Rate
7.3.12 Repo Rate
7.3.13 Balance of Payments
7.3.14 Stock Market Performance
7.3.15 HNWI Wealth vs. GDP Ratio
7.3.16 Capital Formation as % of GDP
7.3.17 Disposable Income as % of GDP
7.3.18 Additional demographic information on UHNWI
8 About WealthInsight

List of tables

Table 1: HNWI Wealth Band and Group Definitions
Table 2: Australian State Statistics
Table 3: HNWIs – Volume by Wealth Band, 2007-15
Table 4: HNWIs – Wealth by Wealth Band, 2007-15
Table 5: HNWIs – Per Capita Net Worth (US$ Million), 2007-15
Table 6: HNWIs – Volume Distribution of the Wealth Pyramid, 2011
Table 7: HNWIs – Wealth Distribution of the Wealth Pyramid, 2011
Table 8: UHNWIs – Volume by Wealth Band, 2007-15
Table 9: UHNWIs – Wealth by Wealth Band, 2007-15
Table 10: UHNWIs – Per Capita Net Worth (US$ Million), 2007-15
Table 11: UHNWIs – Sectors by State, 2011
Table 12: UHNWIs – States by Volume Growth, 2007–11
Table 13: UHNWIs – Cities by Volume Growth, 2007–11
Table 14: UHNWIs – WealthInsight Rating of Private Banking Potential
Table 15: UHNWIs – Billionaires – Market Overview, 2007-15
Table 16: UHNWIs – Centimillionaires – Market Overview, 2007-15
Table 17: UHNWIs – Affluent Millionaires – Market Overview, 2007-15
Table 18: Core HNWIs – Volume by Wealth Band, 2007-15
Table 19: Core HNWIs – Wealth by Wealth Band (in US$ Billion), 2007-15
Table 20: Core HNWIs – Per Capita Net Worth by Wealth Band, 2007-15
Table 21: Core HNWIs – Mid-tier Millionaires – Market Overview, 2007-15
Table 22: Core HNWIs – Lower-tier Millionaires – Market Overview, 2007-15
Table 23: HNWIs – Share (%) of Liquid Assets, 2007-15
Table 24: HNWIs – Change (%) in Liquid Asset Composition, 2007-15
Table 25: HNWIs – Share (%) of Alternative Asset, 2007-15
Table 26: HNWIs – Change (%) in Alternative Asset Composition, 2007-15
Table 27: HNWIs – HNWI – Trends in “Art, Wine and Wheels”, 2006-10
Table 28: HNWIs – Composition (%) of Foreign Assets, 2007-15
Table 29: HNWIs – % Growth, 2007-15
Table 30: HNWI – % Foreign Allocation, 2007-15
Table 31: SFOs - State Comparison and Potential
Table 32: SFOs - Sector Comparison and Potential
Table 33: SFOs – Top 10 SFOs by AuM
Table 34: Major Companies in the Financial Services Industry in Australia
Table 35: SGD to USD Moving Annual Average Exchange Rate, 2006–15
Table 36: Real GDP Growth Rate, 2006–15
Table 37: GDP Per Capita, 2006–15
Table 38: Gross Savings as a % of Real GDP, 2006–2015
Table 39: Domestic Market Capitalization, 2006–10
Table 40: Housing Price Index, 2006–10
Table 41: Commodity Indices, 2006–15
Table 42: Foreign Direct Investments, 2006–2015
Table 43: Investments of FIIs in Equity Products, 2006–10
Table 44: Inflation Rate, 2006–15
Table 45: Repo Rate, 2006–15
Table 46: Balance of Payments, 2006-10
Table 47: Stock Market Performance, 2006–10
Table 48: HNWI Wealth vs. GDP Ratio, 2006–10
Table 49: Capital Formation as % of GDP, 2006-15
Table 50: Disposable Income as % of GDP, 2006-15
Table 51: Major cities in each State

List of figures

Figure 1: HNWI Wealth Band Definitions
Figure 2: HNWI Wealth Sector Market Attractiveness, 2007-15
Figure 3: HNWIs – Australia vs. RoW and Asia-Pacific
Figure 4: HNWIs – Growth Factor Correlation, 2007-11
Figure 5: HNWIs – Volume by Wealth Band, 2007-15
Figure 6: HNWIs – Wealth by Wealth Band (in US$ Billion), 2007-15
Figure 7: HNWIs – Per Capita Net Worth (in US$ Million), 2007-15
Figure 8: HNWIs – Volume Distribution of the Wealth Pyramid, 2011
Figure 9: HNWIs – Wealth Distribution of the Wealth Pyramid, 2011
Figure 10: UHNWIs – Analysis of Wealth Band Evolution, 2007–15
Figure 11: UHNWIs – Volume by Wealth Band, 2007-15
Figure 12: UHNWIs – Wealth by Wealth Band (in US$ Billion), 2007-15
Figure 13: UHNWIs – Per Capita Net Worth (US$ Million), 2007-15
Figure 14: UHNWIs – Age Distribution, 2011
Figure 15: UHNWIs – Job Titles, 2011
Figure 16: UHNWIs – Distribution by Industry, 2011
Figure 17: UHNWIs – Sector Performance, 2007–11
Figure 18: UHNWIs – Importance of Entrepreneurship, 2011
Figure 19: UHNWIs – Regional Share by State and City, 2011
Figure 20: UHNWIs – Regional Count by State and City, 2011
Figure 21: UHNWIs – Human Capital Development Index by State, 2011
Figure 22: UHNWIs – State Performance, 2007-11
Figure 23: UHNWIs – State Performance, 2010-11
Figure 24: UHNWIs – City Performance, 2007-11
Figure 25: UHNWIs – City Performance, 2010-11
Figure 26: UHNWIs – Industry Forecasts, 2011–15
Figure 27: UHNWIs – City Forecasts, 2011–15
Figure 28: UHNWIs – Billionaires – Market Overview, 2007-15
Figure 29: UHNWIs – Centimillionaires – Market Overview, 2007-15
Figure 30: UHNWIs – Affluent Millionaires – Market Overview, 2007-15
Figure 31: Core HNWIs – Volume by Wealth Band, 2007-15
Figure 32: Core HNWIs – Wealth by Wealth Band (in US$ Billion), 2007-15
Figure 33: Core HNWIs – Per Capita Net Worth by Wealth Band, 2007-15
Figure 34: Core HNWIs – Mid-tier Millionaires – Market Overview, 2007-15
Figure 35: Core HNWIs – Lower-tier Millionaires – Market Overview, 2007-15
Figure 36: HNWIs – Asset Class Composition, 2007-15
Figure 37: HNWIs – Changing Trends in Total Liquid Assets (as % of Total Assets), 2007-15
Figure 38: HNWIs – Liquid Assets Composition (US$ Billions), 2007-15
Figure 39: HNWIs – Trends of Investments in Alternative Assets (US$ Billion), 2007-15
Figure 40: HNWIs – Trends in “Art, Wine and Wheels”, 2006-10
Figure 41: HNWIs –Foreign Asset Allocation vs. 2011-2015 Growth
Figure 42: HNWI – Global Distribution of Foreign Investments, 2007-15
Figure 43: SFOs – Geographical location by Region
Figure 44: SFOs – State Comparison
Figure 45: SFOs – By Sector
Figure 46: SFOs – Sector Comparison
Figure 47: SFOs – Retail and Fashion vs. Real Estate
Figure 48: SFOs – Basic Materials and Manufacturing vs. the Services Sector
Figure 49: Australia Wealth Management Industry – Behavioral Mapping, 2011
Figure 50: Australia Wealth Management Industry – Behavioral Mapping, 2011
Figure 51: AUD to USD Moving Annual Average Exchange Rate, 2006–15
Figure 52: Real GDP Growth (%), 2006–15
Figure 53: GDP Per Capita, 2006–15
Figure 54: Gross Savings as a % of Real GDP, 2006–2015
Figure 55: Domestic Market Capitalization, 2006–10
Figure 56: Housing Price Index, 2006–10
Figure 57: Commodity Indices, 2006–15
Figure 58: Foreign Direct Investments, 2006–2015
Figure 59: Investments of FIIs in Equity Products, 2006–10
Figure 60: Inflation Rate, 2006–15
Figure 61: Repo Rate, 2006-15
Figure 62: Balance of Payments, 2006-10
Figure 63: Stock Market Performance, 2006–10
Figure 64: HNWI Wealth vs. GDP Ratio, 2006–10
Figure 65: Capital Formation as % of GDP, 2006-15
Figure 66: Disposable Income as % of GDP, 2006-15
Figure 67: UHNWIs – Age band by sector, 2011
Figure 68: UHNWIs – Job Titles, 2011