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February 12, 2014updated 05 Jun 2017 11:21am

Exclusive: HNWI Analysis: Financial Services

PBI has drawn on WealthInsight's research to analyse a specific industry which plays a major part in driving high net worth wealth creation. This month, PBI looked at financial services in Singapore, Spain, Sweden, Canada and Australia.

By Patrick Brusnahan

PBI has drawn on WealthInsight’s research to analyse a specific industry which plays a major part in driving high net worth wealth creation. This month, PBI looked at financial services in Singapore, Spain, Sweden, Canada and Australia.

Financial services, which include banking, private or otherwise, investing and asset management, are a lucrative, but risky, venture. Obviously, as an industry which deals directly with money, the returns and the failures can be extreme and costly. However, if successful, it can make one incredibly wealthy.

Since the global financial crisis in 2008, economies have been severely impacted worldwide but with new regulations coming into place; the financial services sector is rejuvenating. Banks and regulators had to implement tighter rules to try and counter the loss of reputation they experienced in the midst of the financial crisis.

As the industry is undergoing some important changes, global wealth consultancy WealthInsight found that some places managed to preserve their reputation as a financial hub and attract HNWIs. Although the financial services sector remains steady in some European countries such as Switzerland or the UK, mainly due to their low corporate tax rate, steady reputation and well-structured financial system, not all countries are as lucky. HNWIs with dealings in the financial industry performed inconsistently in different parts of the world but the sector remains profitable for UHNW wealth creation.

Regions with low tax rates and a well-structured and reputable financial system are a hub for investors in the financial services sector.

Key Geographies

Singapore has recently become a popular tax haven for investors and has led to increased investment in the country. 35.3% of Singaporean HNWIs create their wealth in the financial services industry with 36.7% of UHNWIs doing the same. The number of HNWIs between 2007 and 2012 also grew by a substantial 163%.

Name Wealth (US$bn) Industry City of Residence
Dr. Yaw Cho Wee 5.6 Financial Services Quernoy
Mr. Ee Chao Wee 2.9 Financial Services Singapore
Mr. Seng Wee Lee 1.3 Financial Services Singapore

Spain has a thriving financial service and investments industry with 33.5% of HNWIs earning their wealth in this sector. However, there is a significant drop when considering UHNWIs, only 22.7% of which earn their money in the same fashion.

Name Wealth (US$bn) Industry City of Residence
Ms. Alicia de Juseu Koplowitz 2.9 Financial Services Madrid
Mr. Rafael Del Pino y Calvo-Sotelo 2.8 Financial Services N/A
Mr Manuel Capellan Jove 2.6 Financial Services La Coruna

Sweden gains a significant amount of its GDP from the financial sector. One third of HNWIs gain their wealth through this industry and this number remains the same for UHNWIs. Between 2009 and 2013 alone, the sector grew by 27.6% for HNWIs.

Name Wealth (US$bn) Industry City of Residence
Mr. Melker Schorling 3.7 Financial Services Nykoping
Mr. Torbjorn Tornqvist 3.5 Financial Services N/A
Mr. Gustaf Douglas 3.3 Financial Services N/A

Canada’s financial sector is considered to be one of the safest in the world, ranking at number one in most solid financial institutions for the past three years, according to the World Economic Forum. Despite a poor performance between 2007 and 2012, where the number of HNWIs in the financial sector fell by 14%, it remains relatively strong with 22.8% of HNWIs, and 15.4% of UHNWIs, earning their wealth through this business.

Name Wealth (US$bn) Industry City of Residence
Mr. Murray N. Edwards 2.3 Financial Services Regina
Dr. Gerald W. Schwartz 2.0 Financial Services Toronto
Mr. Stephen Arnold Jarislowsky 1.4 Financial Services N/A

Australia has a high reputation within the financial sector due to its high level of transparency and regulation. While this makes it a daunting prospect for many investors, if successful, it can be very rewarding. 18.4% of Australian HNWIs gain their wealth through financial services with 15.7% of UHNWIs following suit. Despite the global financial crisis, the industry still managed 28% growth within the last five years.

Name Wealth (US$bn) Industry City of Residence
Mr. Kerr Neilson 2.3 Financial Services N/A
Mr. David Michael Hains 2.2 Financial Services Melbourne
Mr. Michael Hintze 1.6 Financial Services Balham

 

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