Research

How Wealthy are the Chinese?

by Scott A J MacDonald

This paper looks at the available data about the number of high and ultra-high net worth individuals in China in order to assess the potential for Family Offices in the country. It also considers the possible investment preferences of the Chinese outside China as external capital controls become liberalized. The paper surveys the current state of knowledge published in Rich Lists and investment bank reports and finds that their predictions are contradictory. The paper concludes that there remains much uncertainty about the number, location and asset holdings of the wealthy individuals and families existing in China.

Click here to read the full report, or visit the World Economics website for more information.

From FATCA to CRS – Impact on Family Offices

In recent years, the global tax transparency landscape has changed
significantly. The US Foreign Account Tax Compliance Act (FATCA), which came into force 1 July 2014, was a real game changer and paved the path for subsequent and more global regimes, notably the Common Reporting Standard (CRS).  In practice, these new trends mean that people and entities all over the world are impacted by FATCA and CRS and should be classified accordingly. However, a FATCA and CRS classification are not always identical.

The impact of a new framework to automatically exchange
information for tax purposes — the CRS as issued by the Organization for Economic Co-operation and Development on 21 July 2014 — is broader in scope as compared with FATCA.  Instead of solely identifying US citizens or residents, a financial institution
will be required to identify the residency of all their reportable
customers. More than 101 countries have already committed
to adhering to the CRS. Of these, more than 50 are committed to
the first exchange in 2017.

Click here to read the full report by Ernst & Young

Julius Baer – Bank of China Wealth Report: Asia

This year marks a departure point for the Chinese economy, which will have profound impacts far beyond the region. Already the world’s premier manufacturing exporter, the groundwork is being laid for China to transform its service sector, move up the global value chain and sustain the rapid increase in wealth that the world is witnessing today.

Released in October 2014, the Julius Baer – Bank of China Wealth Report: Asia offers unique insights into how China is changing, and examines closely the aspirations of China’s High Net Worth Individuals, who themselves are the entrepreneurs and business leaders at the forefront of the economic transition. In addition to a ground breaking survey of Bank of China’s client base, this year’s report features a Lifestyle Index dedicated to China alone, which aims to track the cost of luxury living across Asia.

Click here to read the full report.

 

Credit Suisse Global Wealth Report 2014

The Credit Suisse Global Wealth Report provides the most comprehensive and up-to-date source of information on global household wealth. Credit Suisse collaborates with Professors Anthony Shorrocks and Jim Davies, recognized authorities on this topic, and the principal authors of “Personal Wealth from a Global Perspective,” Oxford University Press, 2008. The report measures and analyzes trends in wealth across nations from the very base of the “wealth pyramid” to the ultra-high net worth individuals. The methodology is robust, established over many years of analysis, and completely transparent with regard to the underlying sources and their quality.

Click here to read the full report.

 

Credit Suisse in partnership with Ernst & Young and St Gallen University – Family Office White Paper

The Family Office Dynamic: Pathway to Successful Family and Wealth Management

January, 2014

A recent Family Office White Paper produced by Credit Suisse in partnership with Ernst & Young and St Gallen University recognises the increase in establishment of family offices and offers a comprehensive guide to setting up a family office.

The paper provides insight into best practices within the sector, including investment processes, IT systems, trading tools and platforms. It also includes details of the legal and regulatory situation for family offices in important jurisdictions, including Germany, Austria, Switzerland, the UK, Dubai International Financial Center and the US.

Click here to read the full report.

 

Strategic Capital Management – Investment Infrastructure

May, 2013

Strategic Capital Management’s Investment Infrastructure report outlines the stages of the investment value chain and objectively discusses the question of whether to keep skills in-house, or outsource them. The paper provides family offices and wealth businesses with a framework with which to calculate the value that their firm brings to their clients and make informed decisions around which services to keep in-house and which to outsource.

Click here to read the full report.

 

KPMG Mainland China Trust Survey 2012

KPMG’s second annual China Mainland Trust Survey 2012 reflects on the rapid growth of the trust industry in China, and the high level of transparency witnessed as a result of this development.

The report notes that high net worth individuals (HNWI) are looking toward trusts as alternative ways to increase their portfolio as other wealth management options underperform, as a result of trust companies’ ability to offer access to different asset classes while remaining innovative through increasingly complex product offerings.

Click here to read the full report.

 

GroupM Knowledge – Hurun Wealth Report: The Chinese Millionaire Wealth Report 2013

The GroupM Knowledge – Hurun Wealth Report 2013 describes the distribution of China’s wealthy population, and discusses the way of life of China’s rich, including their investment and consumption preferences, charitable activities and sense of social responsibility, in addition to their use of the media.

The report shows that by the end of 2012, the number of millionaires (whose assets are more than 10 million RMB) had reached 1.05 million, while the number of super rich, whose assets are over 100 million, had reached 64,500 – an increase of 3% and 2% respectively, representing a slowdown from the previous year’s growth.

It goes on to state that while real estate remains millionaires’ first choice when it comes to investment, they have also begun to look energetically for new investment options. Travel abroad remains a primary interest for leisure, study and investing, and good health is what millionaires wish for above all, with quarter of them dissatisfied with their state of health.

Click here to read the full report.

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