India has fourth-largest population of HNIs in APAC

India is home to the fourth-largest population of high net worth individuals (HNIs) in the Asia-Pacific, with total wealth of $797 billion, says a report.

Asia-Pacific (APAC) is a region consisting of the whole of Asia as well as regions bordering the Pacific Ocean, especially the small nations of East Asia. The most commonly quoted figure for membership in the high net worth club is $1 million in liquid financial assets.

The number of HNIs in India jumped to 200,000 last year from 180,000 in 2014, while their overall wealth rose by 1.6 per cent during the same period, according to the Asia-Pacific Wealth Report 2016 by Capgemini on Thursday.

Japan has the largest HNI population in the Asia-Pacific at over 2.7 million followed by China at more than a million in 2015 and Australia, 230,000.

The HNI wealth in Japan rose 11.4 per cent to $6,571 billion, while that in China surged 16.9 per cent to $5,261 billion. One year after recording the highest population of HNIs, the Asia-Pacific now leads the world with the largest amount of HNI wealth, according to the report.

Asia-Pacific HNI wealth grew 9.9 per cent in 2015 to $17.4 trillion, growing 5.8 times the 1.7 per cent growth rate of Rest of the World (RoW) .

HNI population grew 9.4 per cent to pass five million, growing 3.5 times the RoW growth rate of 2.7 per cent.

If growth rates of the last decade sustain through the next one, the region's HNI wealth could pass $42 trillion by 2025, the report added.

Equity and real estate gains remain the strongest pillars supporting this rise in HNI wealth in the Asia-Pacific, overcoming lukewarm economic growth in China, stagnant Japanese economy, and uneven Eurpoean Union and US recoveries, hitting export-dependent emerging Asia.

Yet, China and Japan drove more than 90 per cent of Asia-Pacific's, and 60 per cent of the global, HNI wealth growth adding more than twice as much ($1.43 trillion) as all the other regions outside the Asia-Pacific combined. These two Asian powerhouses increased the number of HNIs by 1.5 times the amount as the rest of the world to top 413,000.

"With the Asia-Pacific now recognised as having both the most high net worth individuals and as being the region with the highest net worth individual wealth, the challenge for the wealth management industry in the region will be to build assets under management," said Anirban Bose, head of banking and capital markets, Capgemini.

"Traditional investing behaviour in the Asia-Pacific is to hold a significant portion of their assets in cash but there is now opportunity for goal-based financial planning with a focus on growth to attract more investment," he said.