Report: Wealth Management in Hungary 2009 TOC

Conservative attitudes to saving and investing have served Hungarian investors well recently
HNWs are unsophisticated on investment matters and very conservative
Hungary has become much more competitive for wealth managers

Hungary is a nation deep in recession
- Prior to the recession, the country was borrowing excessively, exacerbating Hungary' s vulnerability
- Hungary faces a difficult path back to economic stability
Hungary has experienced mixed economic performance over the past five years
- The Budapest stock market has performed relatively poorly over the past five years
- Higher interest and money market rates have helped Hungarian investors in the last couple of years
Hungarian investors like to play it safe with their money
- Deposits dominate the portfolios of Hungarian investors
Despite the recessionary environment, the value of Hungarian HNWs' assets increased in 2008
- There was a small increase in the number of affluents and the value of their assets despite the economic and financial upheaval

The Hungarian wealth management market is developing and providers need to focus on improving their offering
The Wealth Management Opportunity Index
Wealth management market features
Case study: OTP Bank' s wealth management offering has grown phenomenally well but faces real difficulties in the current economic environment
- OTP wealth management commenced operating in the late 1990s
- OTP has greatly increased its client base and assets under management since it restructured in 2002
- OTP wealth management has experienced tremendous product development on an open architecture platform
- Offshore services are not currently a feature of OTP' s wealth management service offering

Datamonitor' s Wealth Management Opportunity Index
- There are five key parameters when assessing a market for its wealth management potential
- There are 18 components to the five key parameters of the wealth management opportunity index
Definitions
The drivers of growth in the wealthy population
- Income growth (combined with inflation, changes in GDP by sector, household savings rates and debt levels)
- Investment returns (market capitalization, interest rates and bond yields)
The following measures are not, in themselves, drivers of wealthy population growth
- Market capitalization
- GDP
The following measures are not drivers of wealthy population growth except under very restricted circumstances
- Primary residence value growth
- Inheritance
Methodology
- Global Wealth Model
Bibliography
Further reading
Ask the analyst
Datamonitor consulting
Disclaimer

Table: The rate of unemployment and average nominal wage growth in Hungary and Europe, 2004 - 2008
Table: Inflation has been variable, although generally relatively high, in Hungary between 2004 and 2008
Table: Market capitalization of Central and Eastern European stock exchanges
Table: Short-term deposit and money market rates, and change in consumer prices in Hungary
Table: The portfolio allocation of retail investors in Hungary
Table: Number of individuals in Hungary in euro bands (000s)
Table: Forecast number of individuals in Hungary in euro bands (000s)
Table: Value of onshore liquid assets in Hungary in euro bands (€ bn)
Table: Forecast value of onshore liquid assets in Hungary in euro bands (€ bn)
Table: Wealth Management Opportunity Index - Hungary
Table: Wealth Management Opportunity Index with values - Hungary

Figure: The unemployment rate in Hungary now eclipses that of Europe as a whole
Figure: The Budapest Stock Exchange has had a battering over the past five years
Figure: Deposit and money market rates have been high in Hungary, above the European average
Figure: Deposits dominate retail investors' portfolios in Hungary
Figure: The number of wealthy individuals in Hungary is set to continue to increase after 2009

Wealth Management in Hungary 2009