23rd June 2012
India is no more enlisted in the list of top 12 countries with largest HNI population as sharp plunge in equity market in 2011 made a bad impact on property and investable wealth of the billionaires.
In the list prepared by Capgemini and RBC Wealth Management the order of the countries with largest High Net-worth Individual (HNI or HNWI) population is as follows:
- US
- Japan
- Germany
- China
- UK
- France
- Canada
- Switzerland
- Australia
- Italy
- Brazil
- South Korea
- India is replaced by South Korea as the 12th country
- India first appeared in the elite list for the first time in 2010.
Why there is decline in HNIs / HNWIs in India?
According to Capgemini and RBC Wealth Management:
- India had lost a large number of High Networth Individuals (HNI) due to sharp decline in equity market in 2011 that shattered asset values as well as levels of investable wealth of these people
- Indian equity market capitalization plunged by a huge 33.4% in 2011, after a gain of 24.9% in 2010.
- Consequently India lost 18% of its HNI population
- Increasing budget/ fiscal deficit also played a devastating role in this loss.
- Lack of faith in the political process and the lethargic domestic reforms upset investors.
As per the Report:
- There is a decline in overall financial wealth of HNIs across all regions, except the Middle-East, where the size of the HNI population increased 2.7% to 0.45 million
- No. of HNIs in Asia-Pacific inflated 1.6% to 3.37 million in 2011
- With this Asia-Pacific became the largest HNI region for the first time. It surpassed North America, which has a HNI population of 3.35 million
- Despite this, North America still has the most HNI wealth at $11.4 trillion compared to $10.7 trillion in the Asia-Pacific region
Who is a High Net Worth Individual (HNI)?
The Merrill Lynch - Capgemini World’s Wealth Report defines:
HNWIs or HNIs: Those who hold at least US$1 million in financial assets
ultra-HNWIs: Those who hold at least US$30 million in financial assets, with both excluding collectibles, consumables, consumer durables and primary residences.
HNWIs or HNIs: Those who hold at least US$1 million in financial assets
ultra-HNWIs: Those who hold at least US$30 million in financial assets, with both excluding collectibles, consumables, consumer durables and primary residences.
**In actual, there is no standard definition of HNIs. They can be based on Net Worth, Investible surplus, assets under advise
Most common standard in India:
a) Emerging HNI: Investible surplus of Rs. 25 lakh - Rs. 2 crore.
b) HNI: Investible surplus of over Rs. 2 crore.
Most common standard in India:
a) Emerging HNI: Investible surplus of Rs. 25 lakh - Rs. 2 crore.
b) HNI: Investible surplus of over Rs. 2 crore.
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