Boston, MA -- (SBWIRE) -- 06/20/2013 -- Wealth management is one of the most promising segments of the global financial services sector due to the emerging markets in Asia and Latin America. However, downside risks have intensified due to financial crises, volatility in capital markets, the movement of capital to relatively safe assets and regions, and increased regulatory pressures and norms. Competitors specialize in various business models in order to cater to the diverse needs of high net worth individual (HNWI) clients. The segment's participants differ in terms of size, corporate structure and clients. Such levels of diversification indicate that the wealth management segment can sustain a variety of profitable business models. Wealth management business models differ in terms of firms, size, corporate structure, clients targeted and revenue generated. Many firms and organizations share common features in terms of their core activities, company history, operations and services, providing a basis for rudimentary or arbitrary business model classifications. It is possible to identify basic wealth management models based around banks or other custodial institutions; broker-dealers and stockbrokers; and investment managers and family offices. These models are not mutually exclusive. One by-product of financial integration means that wealth management firms with a banking background, often have both broking and investment management arms. Similarly, many broking firms have diversified into investment management and other activities to generate more reliable and higher-quality revenue streams.

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Key Highlights

- The wealth management segment emerged as significant to the financial sector in the late 1980s. Due to an increase in demand, the segment was equipped with a network of investment advisors. Global wealth management growth declined dramatically during 2009-2012 due to the US economic crisis, combined with the Eurozone debt crisis in 2011, resulted in high market volatility and minimal growth that swept away investor assets and deterred them from investing in stocks and bonds.
- The Asia-Pacific's HNWIs population recorded significant growth during 2008-2012 at a CAGR of 11.27%, increasing from 2.4 million people in 2008 to 3.7 million people in 2012. Japan was the largest HNWI consumer market and accounted for 52.3% of the region's total HNWI population. China is the second-largest market followed by Australia with respective shares of 17% and 5.1%. During the forecast period, the number of HNWI customers in this region is forecast to increase from 3.9 million people in 2013 to 5.1 million people in 2017, at a CAGR of 6.87%.

Companies Mentioned in this Report: Barclays, BNP Paribas, Deutsche Bank, HSBC, UBS, RBC

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