Israel Wealth Report 2014

This report reviews the performance and asset allocations of HNWIs and ultra-HNWIs in Israel. It also includes an evaluation of the local wealth management market.

Scope

• Independent market sizing of Israel HNWIs across five wealth bands

• HNWI volume, wealth and allocation trends from 2009 to 2013

• HNWI volume, wealth and allocation forecasts to 2018

• HNWI and UHNWI asset allocations across 13 asset classes

• Geographical breakdown of all foreign assets

• Alternative breakdown of liquid vs investable assets

• The number of UHNWIs in major cities

• The number of wealth managers in each city

• City ratings of wealth management saturation and potential

• Details of the development, challenges and opportunities of the wealth management and private banking sector in Israel

• The size of Israel's wealth management industry

• The largest private banks by AuM

• Detailed wealth management and family office information

• Insights into the drivers of HNWI wealth

Key Highlights

• There were 79,346 HNWIs in Israel in 2013. These HNWIs held US$421 billion in wealth.

• In 2013, Israeli HNWI numbers rose by 6.2%, following a decrease of 1.5% in 2012.

• Growth in HNWI wealth and volumes are expected to improve over the forecast period. The number of Israeli HNWIs is forecast to grow by 8.8%, to reach 88,131 in 2018. HNWI wealth is projected to grow by 19.9%, to reach US$535 billion by 2018.

• In 2013, Israeli HNWIs held 24.2% (US$102 billion) of their wealth outside of their home country; the worldwide average is 20–30%.

Reasons to buy

• The Israel Wealth Report 2014 is an unparalleled resource and the leading resource of its kind. Compiled and curated by a team of expert research specialists, the report comprises a wide variety of data created based on over 110,000 HNWIs from around the world in WealthInsight's database.

• With the wealth reports as the foundation for its research and analysis, WealthInsight is able obtain an unsurpassed level of granularity, insight and authority on the HNWI and wealth management universe in each of the countries and regions it covers.

• The report reviews the performance and asset allocations of HNWIs and ultra-HNWIs. The report also includes projections of the volume, wealth and asset allocations of HNWIs to 2018, and a comprehensive background of the local economy.

• The report provides a thorough analysis of the private banking and wealth management sector, latest merger and acquisition activity, and the opportunities and challenges the sector faces.

• It also provides detailed information on HNWI populations in each major city.

Companies mentioned

Bank Hapoalim

Bank Leumi Private Banking

Israel Discount Bank Private Banking

Mizrahi Tefahot Bank Private Banking

Bank of Jerusalem

FIBI Private Banking

Israel Dexia Bank

Union Bank of Israel

Table of Contents

1 Introduction

1.1 Details of this Report

1.2 Definitions

2 Executive Summary

3 Wealth Sector Fundamentals

3.1 Political Background

3.2 Economic Background

3.3 Social Background

3.4 Benchmarking Israel’s Wealth in Context

3.4.1 Distribution of wealth in Israel

3.5 HNWI Volume and Wealth Trends

4 Findings from the WealthInsight HNWI Database

4.1 Trends in HNWI Wealth to 2018

4.1.1 HNWI trend analysis

4.1.2 Trends of the wealth bands

4.1.3 Demographic breakdown of HNWIs

4.1.4 HNWIs – job titles

4.1.5 HNWIs – industry breakdown

4.1.6 HNWIs – industry performance

4.1.7 HNWIs – breakdown by city

4.1.8 HNWIs – city performance

4.1.9 HNWIs – city population densities

4.1.10 HNWIs – city forecasts

4.1.11 HNWIs – breakdown by state

4.1.12 HNWIs – state performance

4.1.13 HNWIs – state population densities

4.2 UHNWIs

4.2.1 UHNWI volume trend analysis

4.2.2 UHNWI wealth trend analysis

4.2.3 Demographic breakdown of UHNWIs

4.2.4 UHNWIs – industry breakdown

4.2.5 UHNWIs – city breakdown and performance

4.3 UHNWIs – Billionaires

4.3.1 Billionaire volume trend analysis

4.3.2 Billionaire wealth trend analysis

4.3.3 Billionaire per capita net worth trend analysis

4.3.4 List of billionaires

4.4 UHNWIs – Centimillionaires

4.4.1 Centimillionaire volume trend analysis

4.4.2 Centimillionaire wealth trend analysis

4.4.3 Centimillionaire per capita net worth trend analysis

4.5 UHNWIs – Affluent Millionaires

4.5.1 Affluent millionaire volume trend analysis

4.5.2 Affluent millionaire wealth trend analysis

4.5.3 Affluent millionaire per capita net worth trend analysis

4.6 Core HNWIs

4.6.1 Core HNWI volume trend analysis

4.7 Core HNWIs – Mid-Tier Millionaires

4.7.1 Mid-tier millionnaire volume trend analysis

4.7.2 Mid-tier millionaire wealth trend analysis

4.7.3 Mid-tier millionaire per capita net worth trend analysis

4.8 Core HNWIs – Lower-Tier Millionaires

4.8.1 Lower-tier millionaire volume trend analysis

4.8.2 Lower-tier millionaire wealth trend analysis

4.8.3 Lower-tier millionaire per capita net worth trend analysis

5 Analysis of Israeli HNWI Investments

5.1 Analysis by Asset Class

5.1.1 Trends in alternative assets

5.1.2 Trends in ‘art, wine and wheels’

5.1.3 Trends of investment in real estate

5.1.4 Trends of investment in cash and deposits

5.1.5 Trends of investment in fixed-income

5.1.6 Trends of investment in equity

5.1.7 Trends of investment in business interests

5.2 Analysis of Foreign Investments

5.2.1 Investments in Europe

5.2.2 Investments in North America (including the US, Mexico and the Caribbean)

5.2.3 Investments in Asia-Pacific

5.2.4 Investments in Central and South America

5.2.5 Investments in the Middle East

5.2.6 Investments in Africa

5.3 Alternative Breakdown: Liquid vs Investable Assets

5.4 Analysis of Israeli UHNWI Investments

6 Competitive Landscape of the Wealth Sector

6.1 Competitive Landscape

6.1.1 Domestic banks

6.1.2 Foreign private banks

6.1.3 Wealth managers

6.1.4 Family offices

6.1.5 Financial advisors

6.2 Developments in the Israeli Private Banking Industry

6.3 Wealth Management and the Private Banking Industry

6.4 Israeli Wealth Management Industry – Clientele Model and Maturity

6.5 Behavioral Mapping of Wealth Management and Private Banking in Israel

6.6 Porter’s Five Force Analysis – the Wealth Management Industry

7 Appendix

7.1 Additional Components of the Wealth Sector in Israel

7.1.1 Philanthropy

7.2 Regulations on Taxes

7.3 Regulations Related to Immigration, Investment and Employment

7.4 Key Drivers

7.4.1 NIS to US$ exchange rate

7.4.2 Real GDP growth

7.4.3 Per capita GDP

7.4.4 Domestic market capitalization

7.4.5 Commodity index

7.4.6 Foreign direct investments (FDI) – inflows and outflows

7.4.7 Inflation rate

7.4.8 Interest rate

7.4.9 Balance of payments

7.4.10 Government debt

7.4.11 Stock market performance

7.5 Wealth Breakdowns

8 About WealthInsight

List of Tables

Table 1: HNWI Wealth Band and Group Definitions

Table 2: Israeli Population Volume of Key Cities (Million), 2013

Table 3: Israeli HNWIs – Volume Distribution (%), 2013

Table 4: Israeli HNWIs – Wealth Distribution Wealth Pyramid (%), 2013

Table 5: Israeli HNWIs – Industry Performance (%), 2009–2013

Table 6: Israeli HNWIs – Populations in Cities and Percentage of HNWIs, 2013

Table 7: Israeli HNWIs – Growth in Top Cities (Thousand), 2009–2013

Table 8: Israeli HNWIs – Population Density in Major Cities (Thousand), 2013

Table 9: Israeli HNWIs Population in Top Cities (Thousand), 2009–2018

Table 10: Israeli HNWIs – Growth Rates for Top Cities (%), 2009–2018

Table 11: Israeli HNWIs – Population by State (Thousand), 2013

Table 12: Israeli HNWIs – Population and State Growth Data (%), 2009–2013

Table 13: Israeli HNWIs – Population Density by State (%), 2013

Table 14: Israeli UHNWIs – Gender Performance, 2009–2013

Table 15: Israeli UHNWIs – Sources of Wealth (%), 2013

Table 16: Israeli UHNWIs in Top Cities (Thousand), 2009–2018

Table 17: Israeli UHNWIs Growth Rates for Top Cities (Thousand), 2009–2018

Table 18: Israeli Billionaires – Market Overview (US$ Billion), 2009–2018

Table 19: Israeli Top 10 Billionaires (US$ Billion), 2013

Table 20: Israeli Billionaire Wealth Growth (US$), 2009−2013

Table 21: Israeli Centimillionaires – Market Overview (US$), 2009–2018

Table 22: Israeli Affluent Millionaires – Market Overview (US$), 2009–2018

Table 23: Israeli Mid-Tier Millionaires – Market Overview (US$), 2009–2018

Table 24: Israeli Lower-Tier Millionaires – Market Overview (US$), 2009–2018

Table 25: Israeli Allocations of HNWI Assets (%), 2009–2018

Table 26: Israeli HNWIs − Holdings Growth (%), 2009–2018

Table 27: Israeli HNWIs – Alternative Asset Composition (%), 2009–2018

Table 28: Israeli HNWIs – Trends of Investments in Alternative Assets (%), 2009–2018

Table 29: Israeli Trends in ‘Art, Wine and Wheels’, 2009–2013

Table 30: Global Prime Real Estate Prices per m2 (US$), 2014

Table 31: Israeli HNWIs – Percentage of Foreign Investment Allocations (%), 2009–2018

Table 32: Israeli HNWIs – Liquidity Breakdown (US$ Billion), 2009–2018

Table 33: Israeli HNWIs – Liquidity Breakdown (%), 2009–2018

Table 34: Israeli UHNWIs – Allocations and Share of HNWI Assets, 2013

Table 35: Israeli Leading Domestic Private Banks, 2013

Table 36: Israeli Leading Foreign Private Banks, 2013

Table 37: Israeli Wealth Managers, 2013

Table 38: Israeli Family Offices, 2013

Table 39: Israeli Wealth Management Industry – Recent Deal Activity, 2013

Table 40: Israeli Income Tax Bands (TRY), 2012–2013

Table 41: Israeli Exchange Rate – NIS to US$, 2009–2018

Table 42: Israeli Real GDP Growth (%), 2009–2018

Table 43: Israeli GDP Per Capita (US$), 2009–2018

Table 44: Israeli Domestic Market Capitalization (US$ Billion), 2009–2013

Table 45: Israeli Commodity Indices, 2009–2018

Table 46: Israeli Foreign Direct Investments (US$ Billion), 2009–2018

Table 47: Israeli Inflation Rate (%), 2009–2018

Table 48: Israeli Money Market Rate (%), 2009–2018

Table 49: Israeli Balance of Payments (US$ Billion), 2009–2013

Table 50: Israeli Government Debt as a Percentage of GDP (%), 2009–2018

Table 51: Israeli Stock Market Performance (Index), 2009–2013

Table 52: Israeli HNWI Wealth vs GDP Ratio (%), 2009–2018

Table 53: Israel – Appendix One

Table 54: Israel – Appendix Two

List of Figures

Figure 1: HNWI Wealth Band Definitions

Figure 2: Map of Israel

Figure 3: Israeli Asset Price Performance (US$), 2009–2013

Figure 4: Israeli HNWI Performance (US$), 2009–2018

Figure 5: Israel vs Global HNWIs in Terms of Volume and GDP per Capita Growth (US$), 2009–2013

Figure 6: Israeli HNWIs – Growth Factor Correlation (Index), 2009–2013

Figure 7: Israeli HNWIs – Volume Distribution Wealth Pyramid (%), 2013

Figure 8: Israeli HNWIs – Wealth Distribution Wealth Pyramid (%), 2013

Figure 9: Israeli HNWIs – Age Distribution, 2013

Figure 10: Israel HNWIs – Job Titles (%), 2009–2013

Figure 11: Israeli HNWIs – Distribution by Industry (%), 2013

Figure 12: Israeli HNWIs – City Performance (Thousand), 2009–2013

Figure 13: Israeli HNWIs – City Population Volumes (Thousand), 2009–2013

Figure 14: Israeli HNWIs – City Forecasts (Thousand), 2014–2018

Figure 15: Israeli HNWIs – City Population Volumes (Thousand), 2014–2018

Figure 16: Israeli UHNWIs – Wealth Share vs Volume Growth (%), 2009–2013

Figure 17: Israeli UHNWIs – Volume by Wealth Band (Thousand), 2009–2018

Figure 18: Israeli UHNWIs – Wealth by Wealth Band (US$ Billion), 2009–2018

Figure 19: Israeli UHNWIs – Age Distribution (Percentage Share), 2013

Figure 20: Israeli UHNWIs – Distribution by Industry, 2013

Figure 21: Israeli Billionaires – Market Overview (US$), 2009–2018

Figure 22: Israeli Centimillionaires – Market Overview (US$), 2009–2018

Figure 23: Israeli Affluent Millionaires – Market Overview (US$), 2009–2018

Figure 24: Israeli Mid-Tier Millionaires – Market Overview (US$), 2009–2018

Figure 25: Israeli Lower-Tier Millionaires – Market Overview (US$), 2009–2018

Figure 26: Israeli HNWIs – Asset Class Composition (%), 2009–2018

Figure 27: Israeli HNWIs – Trends in Alternative Assets (US$ Billion), 2009–2018

Figure 28: Israeli Trends in ‘Art, Wine and Wheels’, 2009–2013

Figure 29: Israeli HNWIs – Foreign Investment Allocation and Growth (%), 2013

Figure 30: Israeli HNWIs – Global Distribution of Foreign Investments (%), 2009–2018

Figure 31: Israeli HNWIs – Liquidity Breakdown (%), 2009–2018

Figure 32: Israeli UHNWIs – Asset Class Composition (%), 2009–2018

Figure 33: Israeli Wealth Management Industry – Maturity Levels of Operators

Figure 34: Israeli Wealth Management Industry – Behavioral Mapping, 2013

Figure 35: Israeli Wealth Management Industry – Five Forces Analysis

Figure 36: Israeli Exchange Rate – TRY to US$, 2009–2018

Figure 37: Israeli Real GDP Growth (%), 2009–2018

Figure 38: Israeli GDP Per Capita (US$), 2009–2018

Figure 39: Israeli Domestic Market Capitalization (US$ Billion), 2009–2013

Figure 40: Israeli Commodity Indices, 2009–2018

Figure 41: Israeli Foreign Direct Investments (US$ Billion), 2009–2018

Figure 42: Israeli Inflation Rate (%), 2009–2018

Figure 43: Israeli Money Market Rate (%), 2009–2018

Figure 44: Israeli Balance of Payments (US$ Billion), 2009–2013

Figure 45: Israeli Government Debt as a Percentage of GDP (%), 2009–2018

Figure 46: Israeli Stock Market Performance (Index), 2009–2013

Figure 47: Israeli HNWI Wealth vs GDP Ratio (%), 2009–2018

Figure 48: Israeli HNWIs – Volume by Wealth Band, 2009–2018

Figure 49: Israeli HNWIs – Wealth by Wealth Band (US$ Billion), 2009–2018

Figure 50: Israeli HNWIs – Wealth per Capita (US$ Million), 2009–2018

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