Wealth Management in Hong Kong 2007

Table of Contents

• Overview
  • Catalyst
  • Summary
• Executive Summary
  • Market Context
  • Competitive Dynamics
• Table of Contents
• Table of figures
• Table of tables
• Market Context
  • Introduction
  • The Hong Kong economy has recovered from recent adverse events
    • After shocks in 1998 and 2001, Hong Kong' s economy has picked up again
    • Hong Kong has experienced long periods of deflation
    • Interest rates has been increasing
    • The stock market has been rising
  • As a result Hong Kong' s savings and investment market has grown strongly
    • Despite a slowdown in 2004, deposits have been growing
    • Direct equity balances have grown strongly
    • Mutual fund investments have increased significantly
    • Direct bond balances were small but increasing
  • Trends in Hong Kong products and services
    • The Premier Banking proposition centers on premium deposits, financial planning and credit cards
      • Premium deposit accounts allow clients to hedge currency risk
      • Financial planning offers clients tailored investment advice
      • Credit card accounts and total debt has increased in 2006
    • And of course Hong Kong is a major offshore FS centre
  • Regulation
    • Market entry rules for banks
  • Despite a slowdown in 2004, Hong Kong' s affluent population and onshore liquid assets has increased strongly
    • 2008-9 will be characterized by struggling economies worldwide
      • Rising interest rates, excessive borrowing and negative savings rates have combined in a perfect storm that will upend most of the world' s economies
      • The widespread securitization of loans will compound this problem
      • And the US economy is not healthy enough to ' expand' itself out of this market
      • Foreign direct investment may also boost the economy, however foreign investors are pulling money out of the US markets
      • A continued Treasury sell-off may further depress the dollar and force interest rate hikes ...
      • Another major terrorist attack in the US would destabilize the economy further
      • Market capitalization will fall worldwide as US stock markets continue their jitters
    • There were more than 1.1 million wealthy individuals in Hong Kong in 2006
    • Wealthy individuals in Hong Kong currently hold USD372.4 billion in onshore liquid assets
  • Hong Kong' s wealthy population represents an attractive market for onshore wealth management
    • There will be more than 1.7 million wealthy individuals living in Hong Kong by 2011
    • Wealthy individuals in Hong Kong will hold almost USD600 billion in onshore liquid assets by 2011
  • Data
• Competitive Dynamics
  • Introduction
  • Hong Kong' s competitive landscape is saturated
    • The locally incorporated licensed banks
    • The foreign incorporated licensed banks
    • The representative foreign banks
  • Wealth Management operations
    • Bank of China Hong Kong
      • Citibank
      • Hang Seng
      • HSBC
      • Standard Chartered Bank
      • ABN AMRO
      • JPMorgan
• APPENDIX
  • Definitions
    • Aggregate
    • CAGR
    • High net worth (HNW)
    • Premier banking population
    • Liquid assets
    • Liquid asset bands
  • Methodology
    • Global Wealth Model Methodology
      • The UK sub model
      • Asia-Pacific sub model
      • Forecasting methodology
      • Continuous refinement to the understanding of liquid wealth distribution
      • Datamonitor' s wealth numbers compared with other wealth numbers
  • Further reading
  • Ask the analyst
  • Datamonitor consulting
  • Disclaimer
  • List of Tables
    • Table 1: Macroeconomic factors of Hong Kong, 2002-06
    • Table 2: Onshore retail liquid asset balances of Hong Kong in USDm, 2002-06
    • Table 3: Onshore retail liquid asset balances of Hong Kong in HKDm, 2002-06
    • Table 4: Aggregate credit card accounts and receivables in Hong Kong, quarterly 2005-06
    • Table 5: Number of wealthy individuals segmented by liquid asset band, 2002-06
    • Table 6: Aggregate onshore liquid assets segmented held by wealthy individuals, by liquid asset band, 2002-06
    • Table 7: Number of wealthy individuals segmented by liquid asset band, 2007-11
    • Table 8: Aggregate onshore liquid assets segmented held by wealthy individuals, by liquid asset band, 2007-11
    • Table 9: Selected locally incorporated wealth services, June 2007
    • Table 10: Selected foreign incorporated private banking brands, June 2007
    • Table 11: Selected of representative banks in Hong Kong, June 2007
  • List of Figures
    • Figure 1: The Hong Kong economy has turned around in recent years
    • Figure 2: The market capitalization of the Hong Kong Exchanges increased sharply in 2006
    • Figure 3: Hong Kong onshore retail savings and investments balances in USDbn, 2002-06
    • Figure 4: Hong Kong had almost 11 million credit card accounts totaling HKD72.2bn in receivables in 2006
    • Figure 5: Wealthy individuals declined in 2004 but recovered strongly by 2006
    • Figure 6: Aggregate onshore liquid assets of wealthy Hong Kong residents grew 14.3% compound annually from 2002-06
    • Figure 7: The number of wealthy individuals in Hong Kong is expected to grow 7.5% compound annually from 2007 to 2011.
    • Figure 8: Aggregate onshore liquid assets of wealthy Hong Kong residents will grow 8.3% compound annually from 2007-2011