Introduction
Analyses the opportunities for wealth managers in South East Asia, focusing on India, Malaysia
and Thailand. The report covers macroeconomic drivers, investor tendencies, offshore preferences,
competitive landscapes and forecasts through 2008.
Scope of this report
- Macroeconomic and savings and investment data drawn from sources like the Reserve Bank of India,
Bank Negara Malaysia and the Bank of Thailand
- Insight into the South East Asian financial services market obtained through in-depth interviews
with the main wealth managers and private bankers
- Sizing and forecasting of mass affluent and high net worth individuals generated from
Datamonitors proprietary Global Wealth Model
Research and analysis highlights
In the view of many in India there is a challenge of client education that must be addressed
going forward. The primary area of concern is in equity investment and the need to invest long-term
rather than short-term. This is not a problem that is confined to India, many other countries around
the globe have similar problems.
The majority of Malaysian companies targeting affluent individuals are competing in the mass
affluent segment and have relatively simplistic product and service propositions.
The provision of specialist services in Thailand for affluent individuals seems to be the
exception rather than the rule. Of the major domestic banks, only Thai Military Bank, Bangkok Bank
and Krung Thai Bank have an affluent offering outside of their normal retail banking services.
Key reasons to read this report
- This report forecasts the market to 2008, allowing competitors to plan strategies on the basis
of detailed market information
- Allows wealth managers to monitor threats and opportunities posed by their main competition
- Helps competitors plan products and services by giving key information on their customers
financial services preferences
CHAPTER 1 INTRODUCTION
What is this report about?
Who is the target reader?
How to use this report
Report Methodology
CHAPTER 2 INDIA
Introduction and macroeconomic background
Population and GDP
Indias population is large and - for the most part - poor
Economic growth is strong, but GDP per capita remains low
Interest rates
FDI
Retail Savings & Investments
Regional wealth
Affluent individuals
Customer profile
Offshore tendency
Restrictions on offshore investment
Return on investment
Though there is some money flowing offshore
Non-resident Indians (NRIs)
Affluent individuals and their assets
Mass affluent
High net worth
Financial services
Liberalization of rules surrounding foreign entry
Regulations prohibit foreign majority ownership
Domestic banks are in need of capital
Changes in ownership rules are just part of a broad range of regulatory changes
The stock market
Banking structure
Local players
Foreign entrants
Onshore private banking and wealth management
Wealth management is at an immature stage in India
Private sector retail banks dominate wealth management
Products and services are relatively simplistic
Competition is clustered around the mass affluent customer segment with few true private banking
services availiable
Restrictions on portfolio management
The competitors
ABN AMRO
Deutsche Bank
HSBC
HDFC Bank
ICICI Bank
Future outlook
Customer outlook
Mass affluent segment
High net worth segment
Wealth market outlook
Domestic banks scale advantages are highly important in an unaware and immature market...
...but international competitors have greater product and service capabilities
Foreign competitors investment management propositions are more sophisticated
Product manufacturing expertise is needed, and being utilized in India
Indias advantages will continue to attract wealth managers
Data
CHAPTER 3 MALAYSIA
Introduction and macroeconomic background
Population and GDP
Malaysias population is diverse
Economic growth has been varied in recent years
Inflation and interest rates
FDI
Retail Savings & Investments
Islamic assets and liabilities
Affluent individuals
Offshore tendency
Malaysians contribute heavily to flows into the main offshore centers
Singaporean competitors are looking to attract money out of Malaysia
Affluent individuals and their assets
Mass affluent
High net worth
Regulatory environment
Financial services
The Financial Sector Master Plan
Capital markets
Securities and fund management companies
Banking structure
Local players
Foreign entrants
Onshore services
Competition is clustered around the mass affluent customer segment with few true private banking
services availiable
The concepts of wealth management and private banking are developing in Malaysia
Premier banking is a more populated market
Islamic banking
Offshore services
Malaysian offshore territories
HSBC the only player to advertise offshore services
Future outlook
Customer outlook
Mass affluent segment
High net worth segment
Wealth market outlook
A population ripe for wealth creation
Strong commitment to financial reform
Stock market development
And an offshore market to back it up
Data
CHAPTER 4 THAILAND
Introduction and macroeconomic background
Population and GDP
Thailands population is diverse
The Thai economy has seen boom and bust in recent years
Inflation and interest rates
FDI
Retail savings & investments
Affluent individuals
Offshore tendency
Thailands investors contribute to flows into Singapore and Hong Kong
Affluent individuals and their assets
Mass affluent
High net worth
Regulatory environment
Financial services
The Financial Sector Master Plan
Capital markets
The Capital Market Master Plan
Banking structure
Local players
Foreign entrants
Onshore services
There is a distinct lack of specialist domestic banking services
Opportunities in the mass affluent space
There is more competition in private client services
Offshore services
Attracting money out of Thailand
Bharat Overseas Bank offers the only NRI service in Thailand
Future outlook
Customer outlook
Mass affluent segment
High net worth segment
Wealth market outlook
Regulatory overhaul is a boon
Opportunities to be taken at the mass affluent level
Local players should make a move on HNWs
Bancassurance is key and developing
Data
CHAPTER 5 APPENDIX
Definitions
AAGR
CAGR
Gini index
Liquid assets
Liquid asset bands
Research methodology
The Global Wealth Model
The UK sub model
Asia-Pacific sub model
Forecasting methodology
Datamonitors wealth numbers compared with others numbers
Bespoke Wealth Market Sizing
Further reading
Datamonitor Asia-Pacific Wealth Reports
Datamonitor Asia-Pacific Insight Reports
Datamonitor Global Wealth Service: Competitor Tracking
Datamonitor Financial Services Consulting
Asia-Pacific contacts
List of Tables
- Table 1: Datamonitors wealth market coverage
- Table 2: Deposits held by population at all commercial banks split by state of branch, September
2004
- Table 3: Total deposits and credit outstanding by banking group, September 2004
- Table 4: Major wealth managers within India, 2004
- Table 5: Comparison of domestic and foreign competitors private banking product and service
range, 2004
- Table 6: GDP and S&I growth over the 1998-2003 period
- Table 7: Indian retail liquid assets, 1998-2003
- Table 8: NRI deposits by type, 1999-2003
- Table 9: Number of Indian mass affluent individuals, 1998-2003
- Table 10: Liquid assets of Indian mass affluent individuals, 1998-2003
- Table 11: Number of Indian high net worth individuals, 1998-2003
- Table 12: Liquid assets of Indian high net worth individuals, 1998-2003
- Table 13: Forecasted retail liquid assets, 2003-2008
- Table 14: Forecasted number of Indian mass affluent individuals, 2003-2008
- Table 15: Forecasted liquid assets of Indian mass affluent individuals, 2003-2008
- Table 16: Forecasted number of Indian high net worth individuals, 2003-2008
- Table 17: Forecasted liquid assets of Indian high net worth individuals, 2003-2008
- Table 18: The local players have a large share of the Malaysian banking market
- Table 19: Services offered by financial institutions in Malaysia
- Table 20: GDP and S&I growth over the 1998-2003 period
- Table 21: Interest rates, inflation and adult population, 1998-2003
- Table 22: Components of GDP, 2003
- Table 23: Malaysian retail liquid assets, 1998-2003
- Table 24: Number of Malaysian mass affluent individuals, 1998-2003
- Table 25: Liquid assets of Malaysian mass affluent individuals, 1998-2003
- Table 26: Number of Malaysian HNW individuals, 1998-2003
- Table 27: Liquid assets of Malaysian HNW individuals, 1998-2003
- Table 28: Forecasted retail liquid assets, 2003-2008
- Table 29: Forecasted number of Malaysian mass affluent individuals, 2003-2008
- Table 30: Forecasted liquid assets of Malaysian mass affluent individuals, 2003-2008
- Table 31: Forecasted number of Malaysian HNW individuals, 2003-2008
- Table 32: Forecasted liquid assets of Malaysian HNW individuals, 2003-2008
- Table 33: The local players have a large share of the Malaysian banking market, 2004
- Table 34: Specialist offerings available in Thailand
- Table 35: GDP and S&I growth over the 1998-2003 period
- Table 36: Bank rate, adult population and inflation, 1998-2003
- Table 37: Thai retail liquid assets, 1998-2003
- Table 38: Components of GDP, 2003
- Table 39: Number of Thai mass affluent individuals, 1998-2003
- Table 40: Liquid assets of Thai mass affluent individuals, 1998-2003
- Table 41: Number of Thai high net worth individuals, 1998-2003
- Table 42: Liquid assets of Thai mass affluent individuals, 1998-2003
- Table 43: Forecasted retail liquid assets, 2003-2008
- Table 44: Forecasted number of Thai mass affluent individuals, 2003-2008
- Table 45: Forecasted liquid assets of Thai mass affluent individuals, 2003-2008
- Table 46: Forecasted number of Thai high net worth individuals, 2003-2008
- Table 47: Forecasted liquid assets of Thai high net worth individuals, 2003-2008
- Table 48: Wealth markets that have been modeled using the Global Wealth Model
List of Figures
- Figure 1: Methodology diagram and report structure
- Figure 2: Major components of Indian GDP, %, 2003
- Figure 3: Indias bank rate has been reduced by the Reserve Bank in recent years in an attempt
to stimulate investment
- Figure 4: Savings and investment assets in India have exhibited strong growth over the last five
years
- Figure 5: Deposits remain the primary investment vehicle but are decreasing in importance among
Indian investors
- Figure 6: The market for NRI deposits is valuable and growing fast
- Figure 7: The liquid wealth of mass affluent individuals in India grew at a rate of 17.2% CAGR
over the 1998-2003 period
- Figure 8: The number of Indian HNW individuals in the USD3M+ liquid asset band grew by 20.6%
AAGR over the 1998-2003 period
- Figure 9: Positioning of key wealth mangers according to wealth of customer segment and breadth
of product range, 2004
- Figure 10: Those individuals with more than USD150,000 will own approximately 50% of total
retail liquid wealth in 2008
- Figure 11: The mass affluent population will grow at a rate of 10.4% over the 2003-2008 period
- Figure 12: There will be 45,300 more high net worth individuals in India in 2008 than in 2003
- Figure 13: Major components of Malaysian GDP, %, 2003
- Figure 14: Malaysias interest rates have fallen in recent years alongside US rates
- Figure 15: Savings and investment assets in Malaysia have exhibited strong growth over the last
five years
- Figure 16: Deposits were the slowest growing investment vehicle for Malaysian investors between
1998 and 2003
- Figure 17: The liquid wealth of mass affluent individuals in Malaysia grew at a rate of 8.6%
CAGR over the 1998-2003 period
- Figure 18: The number of Malaysian HNW individuals grew by 9.3% AAGR over the 1998-2003 period
- Figure 19: The Islamic banking logo, which must be used alongside all Islamic products in
Malaysia
- Figure 20: HNW individuals will own more than a third of total retail liquid wealth in 2008
- Figure 21: The mass affluent population will grow at a rate of 7.6% over the 2003-2008 period
- Figure 22: There will be 22,500 more high net worth individuals in Malaysia in 2008 than in 2003
- Figure 23: Major components of Thai GDP, %, 2003
- Figure 24: Thailands interest rates have fallen in recent years in keeping with the global
trend
- Figure 25: Retail savings and investment assets in Thailand have grown faster than the economy
over the last five years
- Figure 26: Deposits were the slowest growing investment vehicle for Thai investors between 1998
and 2003
- Figure 27: The liquid wealth of mass affluent individuals in Thailand grew at a rate of 6.8%
CAGR over the 1998-2003 period
- Figure 28: The number of Thai HNW individuals grew by 7.2% AAGR over the 1998-2003 period
- Figure 29: HNW individuals will own almost half of total retail liquid wealth in 2008
- Figure 30: The mass affluent population will grow at a rate of 9.8% over the 2003-2008 period
- Figure 31: There will be 39,000 more high net worth individuals in Thailand in 2008 than in 2003
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