Introduction
Emerging Wealth Markets in Asia-Pacific is Datamonitor’s guide to the affluent wealth landscapes in Malaysia, South Korea and Taiwan. Following the popularity of Datamonitor’s recent research in the Indian and Chinese markets, the report explores some of the less high-profile emerging wealth markets in the Asia-Pacific region.

Scope
Based on data collected directly from governmental sources such as central banks, mutual fund associations and stock exchanges.

Insight into the respective financial services market was obtained through in-depth interviews with the main wealth managers and private bankers

Sizing and forecasting of high net worth individuals were generated by Datamonitor's proprietary Global Wealth Model

Report Highlights
There is some consensus that it is not the high net worth individuals that are the key to the Malaysian market. Rather, it is those individuals with more than EUR100,000 (USD130,000) that are the most attractive market segment.

Citigroup Private Bank is seen as a big threat in the Korean market. The bank has a team of local Korean private bankers, which is important in the market. However, Citibank’s strength lies in combining this local team with its international network and subsequent access to a wide range of diverse products and services.

It has been widely acknowledged that the region is facing a talent shortage in the wealth management space, with competitors at once trying to retain relationship managers and poach others from their competitors.

Reasons to Purchase
Find out why these markets are attractive and their advantages over other emerging economies.

Find out how large the markets are now and how large they will be in 2010

Find out how big the opportunities for growth will be going forward

CHAPTER 1 INTRODUCTION 12
What is this report about? 12
Who is the target reader? 12
How to use this report 12
CHAPTER 2 MACROECONOMIC OVERVIEW 14
Market comparisons 14
The four economies 14
Sectoral breakdown 14
Size and growth 15
GDP per capita 16
Inflation and consumer prices 17
Population and unemployment 18
CHAPTER 3 THE MALAYSIAN WEALTH MARKET 21
Market background 21
Savings and investments 21
Islamic deposits and finance 23
Size of the affluent market 23
Financial services and the regulatory environment 27
Financial services 27
The Financial Sector Master Plan 27
Capital markets 28
Competitive dynamics 30
The local players 30
The foreign players 31
Developments in 2006 31
November 2005 - Citibank offers additional overseas investments 31
March 2006 - Standard Chartered optimistic on growth 32
April 2006 - Alliance forms joint venture to boost its wealth management offering in Malaysia 33
August 2006 - Citigroup launches European fund in Malaysia 33
November 2006 - CIMB launches Malaysian fund-of-funds 34
December 2006 - Hong Leong revinvents Priority Banking 35
Future focus 36
The affluent outlook 36
Mass affluent segment 37
High net worth segment 38
CHAPTER 4 THE SOUTH KOREAN WEALTH MARKET 40
Market background 40
Savings and investments 40
Size of the affluent market 41
Financial services and the regulatory environment 46
Financial sector restructure 46
Competitive dynamics 48
Commercial banks 48
Private/ premier banking and wealth management 49
Developments in 2006 50
April 2006 - Credit Suisse create Korean JV 50
July 2006 - UBS acquires a stake in Korean asset manager 50
August 2006 - Standard Chartered bullish on market share 51
Future focus 52
The affluent outlook 52
Mass affluent segment 53
High net worth segment 54
CHAPTER 5 THE TAIWANESE WEALTH MARKET 55
Market background 55
Savings and investments 55
Size of the affluent market 57
Financial services and the regulatory environment 60
June 2005 - Taiwan limits wealth management fees to 'wealthy' 60
February 2006 - The resource drain 61
May 2006 - Taiwanese regulator amends wealth management regulations 62
Competitive dynamics 63
Competitive developments in 2006 63
October 2005 - BNP Paribas expands into Taiwan 63
October 2005 - ABN AMRO opens in Taiwan 64
December 2005 - Citigroup launches private banking in Taiwan 64
October 2006 - First Sino Bank applying for renminbi license 65
The affluent outlook 66
Mass affluent segment 67
High net worth segment 68
CHAPTER 6 APPENDIX 70
Data 70
Definitions 80
AAGR 80
Affluent 80
CAGR 80
Gini index 80
Liquid assets 81
Liquid asset bands 81
Research methodology 82
The Global Wealth Model 83
The UK sub model 83
Asia-Pacific sub model 83
Forecasting methodology 83
Datamonitor's wealth numbers compared with others' numbers 84
Bespoke Wealth Market Sizing 85
Further reading 86
Datamonitor Asia-Pacific Wealth Reports 86
Datamonitor Asia-Pacific Insight Reports 86
Datamonitor Global Wealth Service: Competitor Tracking 86
Asia-Pacific contacts 87
List of Tables
Table 1: The local players have a much larger share of the Malaysian banking market than the foreign players 31
Table 2: Sectoral breakdown of GDP in Malaysia, Thailand, South Korea and Taiwan, 2005 70
Table 3: Indexed GDP growth, 1999=100 70
Table 4: GDP per capita, GDP in USDbn and average GDP growth 70
Table 5: Consumer Price Indices of Malaysia, Thailand, South Korea and Taiwan, 2000-2005 71
Table 6: Rate of unemployment in Malaysia, Thailand, South Korea and Taiwan, 2000-2005 71
Table 7: Population breakdown by age in Malaysia, Thailand, South Korea and Taiwan, 2005 71
Table 8: Malaysian retail savings and investments, 2000-2005 72
Table 9: South Korean retail savings and investments, 2000-2005 72
Table 10: Taiwanese retail savings and investments, 2000-2005 72
Table 11: Onshore liquid wealth owned by individuals in Malaysia, 2001-2005 73
Table 12: Number of affluent individuals in Malaysia, 2001-2005 74
Table 13: Onshore liquid wealth owned by individuals in Malaysia, 2006-2010 74
Table 14: Number of affluent individuals in Malaysia, 2001-2005 75
Table 15: Onshore liquid wealth owned by individuals in South Korea, 2001-2005 75
Table 16: Number of affluent individuals in South Korea, 2001-2005 76
Table 17: Onshore liquid wealth owned by individuals in South Korea, 2006-2010 76
Table 18: Number of affluent individuals in South Korea, 2006-2010 77
Table 19: Onshore liquid assets owned by affluent individuals in Taiwan, 2005-2010 77
Table 20: Number of affluent individuals in Taiwan, 2001-2005 78
Table 21: Onshore liquid wealth owned by individuals in Taiwan, 2006-2010 78
Table 22: Number of affluent individuals in Taiwan, 2006-2010 79
Table 23: Wealth markets that have been modelled using the Global Wealth Model 85
List of Figures
Figure 1: Report structure and research model 13
Figure 2: A sectoral breakdown of the four economies reveals varying reliance on the services sector, with Taiwan's economy being the most reliant 15
Figure 3: Taiwan's economy grew at the slowest overall rate between 2001 and 2005 16
Figure 4: South Korea's economy is by far the largest of the four and saw good average annual growth over the 2001-2005 period 17
Figure 5: All four economies have seen low inflation of consumer prices over the 2000-2005 period 18
Figure 6: Of the four countries Malaysia has the youngest population profile 19
Figure 7: All four countries have low unemployment on a global scale, with Thailand's rate the lowest in 2005 20
Figure 8: Retail savings and investments outgrew GDP growth over the 2000-2005 period 22
Figure 9: The investible assets of affluent individuals in Malaysia amounted to more than USD112bn at the end of 2005 24
Figure 10: The number of those with between USD60,000 and USD500,000 grew at an average annual rate of 9.4% between 2000 and 2005 25
Figure 11: The number of individuals with more than USD500,000 in investible assets grew by 8,600 between 2000 and 2005 26
Figure 12: Mass affluent individuals with between USD60,000 and USD500,000 will own almost half of all retail liquid assets in 2010 36
Figure 13: The number of individuals with between USD60,000 and USD500,000 in investible assets will grow by almost 40% between 2005 and 2010 37
Figure 14: The overall liquid wealth of affluent individuals will grow at a rate of 8.1% compounded annually over the 2005-2010 period, primarily benefiting the most affluent individuals 38
Figure 15: The fastest growing high net worth sub-segment over the 2005-2010 period will be that composed of individuals with USD3m-4m in onshore liquid assets 39
Figure 16: Retail savings and investments growth flattened out in 2003, but the market did not see a major dip as other countries did 41
Figure 17: Individuals with between USD60,000 and USD500,000 in investible assets grew to more than 1.6 million in 2005 43
Figure 18: The number of high net worth individuals in South Korea dipped in 2003 before growing in 2004 and 2005 44
Figure 19: Typical diversified investment portfolio of a Korean individual with more than USD10m, as provided by Korean wealth managers, 2006 45
Figure 20: Commercial banks in South Korea fall into three categories, Nationwide Banks, Local Banks and Foreign Bank Branches 48
Figure 21: Mass affluent individuals with between USD60,000 and USD500,000 will own 50% of all retail liquid assets in 2010 52
Figure 22: The number of individuals with between USD60,000 and USD500,000 in investible assets will grow by more than 30% between 2005 and 2010 53
Figure 23: The overall liquid wealth of mass affluent individuals will grow at a rate of 6.4% compounded annually over the 2005-2010 period, not a great deal fasted than overall retail liquid wealth 54
Figure 24: Growth in retail savings and investments has outpaced GDP growth by a considerable margin in Taiwan over the 2000-2005 period 56
Figure 25: The liquid wealth of Taiwanese affluent individuals grew by more than 60% over the 2000-2005 period 58
Figure 26: Those with more than USD10m in liquid assets have grown rapidly in number over the 2000-2005 59
Figure 27: High net worth individuals with more than USD500,000 in liquid assets will own 32% of all retail liquid assets in 2010 66
Figure 28: The number of individuals with between USD60,000 and USD500,000 in investible assets will grow by more than 39% between 2005 and 2010 67
Figure 29: The overall liquid wealth of affluent individuals in Taiwan will grow at a rate of 8.1% compounded annually over the 2005-2010 period, not a great deal fasted than overall retail liquid wealth 68
Figure 30: High net worth individuals in Taiwan will own USD222bn in liquid assets at the end of 2010 69