[Extracted from cover story of The Straits Times, Saturday, 12 June 2010]
Author: Gabriel Chen, The Straits Times – Singapore Press Holdings
Singapore added millionaires at a faster rate than anywhere else in the world last year, despite a recession that decimated wealth in many nations.
The millionaire club grew by 35 per cent here, putting Singapore just ahead of second-placed Malaysia with a 33 per cent gain, and Slovakia on 32 per cent and China on 31 per cent.
In absolute numbers, the United States still has by far the most millionaire households at 4.7million, followed by Japan and China. But you are more likely to bump into a millionaire here.
An annual study by Boston Consulting Group (BCG) showed that Singapore had the highest concentration of millionaires, as in 2008. A total of 11.4 per cent of households here own more than US$1million (S$1.4million) – defined as those with investable assets of over US$1million, exclusive of property and items like art. BCG did not provide the number of millionaire households in Singapore.
Hong Kong was next in terms of concentration, followed by Switzerland, Kuwait, Qatar, the United Arab Emirates and the US.
Singaporean T.J Thang, who belongs to the elite group, did not fare too badly during the downturn. “Some of my stocks fell in value during the recession, but I was getting attractive property rental yields, and hence my cash grew.” said the 49-year-old businessman.
Economists and wealth managers cite a number of factors as to why Singapore is leading the way in the growth of millionaire households. One is Singapore’s “liberal admissions policy” to attract talent and the well-heeled, said CIMB Research economist Song Seng Wun.
Today, virtually every big-name private bank which caters to the well-heeled has made Singapore its regional hub.
What this latest reports means is, “for all the private bankers who are here, it confirms that Singapore is the right spot to be”, said Mr Rolf Gerber, chief executive of LGT Bank in Liechtenstein (Singapore).
BCG believes that another factor of this rise could be the strength of the Singapore dollar currency against the US dollar.
BCG’s study reviewed the assets under management covering 62 markets representing around 99 per cent of global economic output.
Top of the list
[Country growth in millionaire households]
South Korea: 28%
United Arab Emirates: 23%