The number of ultra-high-net-worth (UHNW) individuals in the Philippines will increase drastically since the country’s economy will continue to grow at a stable rate, and as the country’s equity markets continue to grow steadily, according to a survey by Q Intel Research.
Q Intel Research believes that the Philippines ultra-high-net-worth Individuals will reach 302 by 2018. Based on their forecasted data, the Philippines economy has stabilized and will therefore result in mass creations of wealth that are going unnoticed by bankers within the country and the international community.
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Makati will continue to be the Philippines hub of UHNWIs. The city will continue to attract foreign investment from Asian countries and the West as the Philippines continues to rapidly develop and demand foreign expertise to ensure that it does not get snarled in the middle-income trap.
The further development of its banking and finance center will strengthen as its surrounding companies such as the EEI corporation will continue to grow at rapid rates.
As of 2010 its estimated that there are around 16,000 HNWIs in the Philippines, and that that number will increase to around 24,000 within a few years. By 2015 the Philippines will have around 37,000 HNWIs, which is about 0.038% of its population.
And the combined wealth of the HNWIs is around US$164 billion, which is ranked ninth in Asia right behind Malaysia, which has more doubled the amount of HNWIs. Other major research firms have different ranges of the predicted HNWIs growth by 2015, between 26-38,000.
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By GlobalDataBaron Laudermilk, head of Research and managing director, Q Intel Research, said: "It is a good time to be in wealth management in the Philippines, and we are certain that it will continue to be a booming market for wealth managers in the next five years. The stability of the country’s economy, its growing stock market, and young workforce, will continue to produce HNWIs and UHNWIs. We see that UHNWIs in the Philippines will continue to emerge, especially in the country’s financial and business centers, which have the sophistication and lifestyle that they are seeking."
Other key findings in the report:
- There has been a major change in investment attitudes of Filipino HNWIs since 2010. In 2010 HNWIs utilized a conservative, long-term, low yield investment strategy, as they preferred to invest in bonds and cash-based products rather than to invest in short-term, sophisticated securities and alternative investments.
- More Filipino HNWIs are using mobile and computing and are seeking ways in which they can utilize these new technologies to stay in touch with their investments and to learn more about future investment opportunities.
- BDO is one of the strongest competitors in the Filipino market, holding a major market share, our prediction is that they own an estimated of at least 20% of the HNWIs within the market. The bank’s strongest advantages is that it has clearly developed its wealth management products and has built a strong private banking platform that has international expertise that can aid HNWIs to build customized portfolios for clients depending on the stage and they are in life.
- The wealth-management arm of the Bank of the Philippine Islands (BPI), which has acquired the investment-banking unit of the Dutch financial services ING in 2011, has seen around 15% growth in assets under the management (AUM) for the year.
