Indonesia Wealth Report 2015

This report defines wealth as the net value of assets, including both financial holdings and tangible assets. To provide the most comprehensive analysis of Indonesian HNWI wealth, the total wealth held by HNWIs has been calibrated across six major asset classes: alternatives; real estate (excluding primary residences); cash and deposits; fixed-income; equity; and business interests.

Liquid and investable assets have also been analyzed to provide further insight into the Indonesian HNWI sector, and the opportunities it presents for wealth sector professionals. Despite unfavorable world market conditions, the wealth management market in Indonesia is emerging.

Lower-tier millionaires tend to have most of their wealth tied up in cash, fixed-income products, local real estate and other less-risky assets – few use wealth managers. As older lower-tier millionaires prepare for retirement, they may present an opportunity for wealth sector professionals.

Much of Indonesia’s wealth management and private banking sector growth during the last decade has been driven by the volume of HNWIs and UHNWIs in Indonesia. UHNWIs are typically older than their core millionaire counterparts. Wealth sector professionals looking to do business with Indonesian UHNWIs will therefore have to tailor their offerings accordingly, taking into account increased demand from UHNWIs for estate planning, establishment of trusts and philanthropic donations.

Scope

• HNWI volume, wealth and allocation forecasts to 2019

• An examination of HNWI and UHNWI asset allocations across 13 asset classes

• A geographical breakdown of all foreign assets

• An alternative breakdown of liquid versus investable assets

• Data on the number of UHNWIs in major Indonesian cities

• Insight on the development, challenges and opportunities for participants in the wealth management and private banking sector in Indonesia

• An overview of the size of Indonesia's wealth management industry

• Detailed wealth management and family office information

• Insights into the key drivers of HNWI wealth in Indonesia

• An independent market sizing of Indonesian HNWIs across five wealth bands

Key Highlights

• How many HNWIs were there in Indonesia in 2014? How much wealth do they collectively hold?

• What was the percentage rise in the Indonesian HNWI population in 2014? How does this rise compare with the previous year?

• By what percentage is the Indonesian HNWI population forecast to grow by 2019? What total is the HNWI population forecast to reach in 2019? By how much is HNWI wealth projected to grow in Indonesia? What total wealth will they collectively hold by 2019?

Reasons to buy

• Assess and evaluate the competitive landscape of the Indonesian wealth management industry; identify growth opportunities that will deliver you the best return on investment whilst minimizing business risk

• Investigate a comprehensive analysis of the private banking and wealth management sectors in Indonesia and deliver your value proposition to prospects and clients based on the most current market information

• Gain a competitive advantage by acquiring a better understanding of the key local and cultural variations in Indonesia

Companies mentioned

Bank Mandiri’s private banking, Bank Negara Indonesia, PT Bank Rakyat Indonesia Tbk, Bank Mega, Bank CIMB Niaga, ANZ Indonesia, Deutsche Bank, PT Bank CIMB Niaga Tbk, PT Bank Mandiri (Persero) Tbk and PT Ngrumat Bondo Utomo

Table of Contents

1 Introduction

1.1 Details of this Report

1.2 Definitions

2 Executive Summary

3 Indonesia Key Facts

4 Distribution of Wealth in Indonesia

4.1 HNWI Volume and Wealth Trends

5 Findings from the WealthInsight HNWI Database

5.1 Trends in HNWI Wealth to 2019

5.1.1 HNWI trend analysis

5.1.2 Wealth band trends

5.1.3 Demographic breakdown of HNWIs

5.1.4 HNWIs – job titles

5.1.5 HNWIs – industry breakdown

5.1.6 HNWIs – industry performance

5.1.7 HNWIs – breakdown by city

5.1.8 HNWIs – city performance

5.1.9 HNWIs – city population densities

5.1.10 HNWIs – city forecasts

5.2 UHNWIs

5.2.1 UHNWI volume trend analysis

5.2.2 UHNWI wealth trend analysis

5.2.3 Demographic breakdown of UHNWIs

5.2.4 UHNWIs – industry breakdown

5.2.5 UHNWIs – city breakdown and performance

5.3 UHNWIs – Billionaires

5.3.1 Billionaire volume trend analysis

5.3.2 Billionaire wealth trend analysis

5.3.3 Billionaire per capita net worth trend analysis

5.3.4 List of billionaires

5.4 UHNWIs – Centimillionaires

5.4.1 Centimillionaire volume trend analysis

5.4.2 Centimillionaire wealth trend analysis

5.4.3 Centimillionaire per capita net worth trend analysis

5.5 UHNWIs – Affluent Millionaires

5.5.1 Affluent millionaire volume trend analysis

5.5.2 Affluent millionaire wealth trend analysis

5.5.3 Affluent millionaire per capita net worth trend analysis

5.6 Core HNWIs

5.6.1 Core HNWI volume trend analysis

5.7 Core HNWIs – Mid-Tier Millionaires

5.7.1 Mid-tier millionaire volume trend analysis

5.7.2 Mid-tier millionaire wealth trend analysis

5.7.3 Mid-tier millionaire per capita net worth trend analysis

5.8 Core HNWIs – Lower-Tier Millionaires

5.8.1 Lower-tier millionaire volume trend analysis

5.8.2 Lower-tier millionaire wealth trend analysis

5.8.3 Lower-tier millionaire per capita net worth trend analysis

6 Analysis of Indonesian HNWI Investments

6.1 Analysis by Asset Class

6.1.1 Trends in alternative assets

6.1.2 Trends in ‘art, wine and wheels’

6.1.3 Trends of investment in real estate

6.1.4 Trends of investment in cash and deposits

6.1.5 Trends of investment in fixed-income

6.1.6 Investment trends in equity

6.1.7 Investments trends in business interests

6.2 Analysis of Foreign Investments

6.2.1 Investments in Europe

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

6.2.3 Investments in the Asia-Pacific

6.2.4 Investments in South America

6.2.5 Investments in the Middle East

6.2.6 Investments in Africa

6.3 Alternative Breakdown: Liquid vs Investable Assets

6.4 Analysis of Indonesian UHNWI Investments

7 Competitive Landscape

7.1 Domestic private banks

7.2 Foreign Private Banks

7.3 Wealth managers

7.4 Family offices

8 Key Drivers

8.1 INR–US$ Exchange Rate

8.2 Real GDP Growth

8.3 Per Capita GDP

8.4 Domestic Market Capitalization

8.5 Commodity Index

8.6 Foreign Direct Investment (FDI) – Inflows and Outflows

8.7 Inflation Rate

8.8 Interest Rate

8.9 Balance of Payments

8.10 Government Debt

8.11 Stock Market Performance

8.12 Wealth Breakdowns

9 About WealthInsight

List of Tables

Table 1: HNWI Wealth Band and Group Definitions

Table 2: Indonesian HNWIs – Volume Distribution (%), 2014

Table 3: Indonesian HNWIs – Wealth Distribution Wealth Pyramid (%), 2014

Table 4: Indonesian HNWIs – Industry Performance (%), 2010–2014

Table 5: Indonesian HNWIs – Cities, 2014

Table 6: Indonesian HNWIs – Growth in Top Cities (Thousand), 2010–2014

Table 7: Indonesian HNWIs – Population Density in Major Cities 2014

Table 8: Indonesian HNWIs – Populations in Top Cities (Thousand), 2010–2019

Table 9: Indonesian HNWIs – Growth Rates for Top Cities (%), 2010–2019

Table 10: Indonesian HNWIs – Sources of Wealth (%), 2014

Table 11: Indonesian UHNWIs – Gender Performance (%), 2010–2014

Table 12: Indonesian UHNWIs – Populations in Top Cities, 2010–2019

Table 13: Indonesian UHNWIs – Growth Rates for Top Cities (%), 2010–2019

Table 14: Indonesian Billionaires – Market Overview (Volume and US$ Billions) 2010–2019

Table 15: Indonesian Top Billionaires (US$ Billion), 2014

Table 16: Indonesian Billionaires – Wealth Growth (US$ Billion), 2010−2014

Table 17: Indonesian Centimillionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Table 18: Indonesian Affluent Millionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Table 19: Indonesian Mid-Tier Millionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Table 20: Indonesian Lower-Tier Millionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Table 21: Indonesian HNWIs – Assets Allocations (%), 2010–2019

Table 22: Indonesian HNWIs – Holdings Growth (%), 2010–2019

Table 23: Indonesian HNWIs – Alternative Asset Composition (%), 2010–2019

Table 24: Indonesian HNWIs – Trends of Investments in Alternative Assets (%), 2010–2019

Table 25: Indonesian Trends in ‘Art, Wine and Wheels’, 2010–2014

Table 26: Global Prime Real Estate Prices per m2 (US$), 2014

Table 27: Indonesian HNWIs – Foreign Investment Allocations (%), 2010–2019

Table 28: Indonesian HNWIs – Liquidity Breakdown (US$ Billion), 2010–2019

Table 29: Indonesian HNWIs – Liquidity Breakdown (%), 2010–2019

Table 30: Indonesian UHNWIs – Allocations and Share of HNWI Assets (%), 2014

Table 31: Indonesian Exchange Rate – IDR–US$ Exchange Rate, 2010–2019

Table 32: Indonesian Real GDP Growth (%), 2010–2019

Table 33: Indonesian GDP per Capita (US$), 2010–2019

Table 34: Indonesian Domestic Market Capitalization (US$ Billion), 2010–2014

Table 35: Indonesian Commodity Indices, 2010–2019

Table 36: Indonesian Foreign Direct Investment (US$ Billion), 2010–2019

Table 37: Indonesian Inflation Rate (%), 2010–2019

Table 38: Indonesian Money Market Rate (%), 2010–2019

Table 39: Indonesian Balance of Payments (US$ Billion), 2010–2014

Table 40: Indonesian Government Debt as a Percentage of GDP (%), 2010–2019

Table 41: Indonesian Stock Market Performance (Index), 2010–2014

Table 42: Indonesian HNWI Wealth vs. GDP Ratio (%), 2010–2019

Table 43: Indonesia – Appendix One

Table 44: Indonesia – Appendix Two

List of Figures

Figure 1: HNWI Wealth Band Definitions

Figure 2: Map of Indonesia

Figure 3: Indonesian Asset Price Performance (%), 2010–2014

Figure 4: Indonesian HNWI Performance (US$ Billion and HNWI Volume), 2010–2019

Figure 5: Indonesian vs Global HNWIs (%), 2010–2019

Figure 6: Indonesian HNWIs – Growth Factor Correlation, 2010–2014

Figure 7: Indonesian HNWIs – Wealth Pyramid (Volume Distribution), 2014

Figure 8: Indonesian HNWIs – Wealth Pyramid (Wealth Distribution), 2014

Figure 9: Indonesian HNWIs – Age Distribution (%), 2014

Figure 10: Indonesian HNWIs – Job Titles (%), 2010–2014

Figure 11: Indonesian HNWIs – Distribution by Industry (%), 2014

Figure 12: Indonesian HNWIs – City Performance (%), 2010–2014

Figure 13: Indonesian HNWIs – Volume of HNWIs by City (Thousand), 2010–2014

Figure 14: Indonesian HNWIs – City Forecasts (%), 2015–2019

Figure 15: Indonesian HNWIs – Population by City (Thousand), 2015–2019

Figure 16: Indonesian UHNWIs – Wealth Share vs Volume Growth (%), 2010–2014

Figure 17: Indonesian UHNWIs – Volume by Wealth Band 2010–2019

Figure 18: Indonesian UHNWIs – Wealth by Wealth Band (US$ Billion), 2010–2019

Figure 19: Indonesian UHNWIs – Age Distribution (Percentage Share), 2014

Figure 20: Indonesian UHNWIs – Distribution by Industry (%), 2014

Figure 21: Indonesian Billionaires – Market Overview (Volume and US$ Billion), 2010–2019

Figure 22: Indonesian Centimillionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Figure 23: Indonesian Affluent Millionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Figure 24: Indonesian Mid-Tier Millionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Figure 25: Indonesian Lower-Tier Millionaires – Market Overview (Volume and US$ Million/Billion), 2010–2019

Figure 26: Indonesian HNWs – Asset Class Composition (%), 2010–2019

Figure 27: Indonesian HNWIs – Trends in Alternative Assets (US$ Billion), 2010–2019

Figure 28: Indonesian Trends in ‘Art, Wine and Wheels’, 2010–2014

Figure 29: Indonesian HNWIs – Foreign Investment Allocation and Growth (%), 2014

Figure 30: Indonesian HNWIs – Global Distribution of Foreign Investments (%), 2010–2019

Figure 31: Indonesian HNWIs – Liquidity Breakdown (%), 2010–2019

Figure 32: Indonesian UHNWIs – Asset Class Composition (%), 2010–2019

Figure 33: Indonesian Exchange Rate – INR–US$, 2010–2019

Figure 34: Indonesian Real GDP Growth (%), 2010–2019

Figure 35: Indonesian GDP per Capita (US$), 2010–2019

Figure 36: Indonesian Domestic Market Capitalization (US$ Billion), 2010–2014

Figure 37: Indonesian Commodity Indices, 2010–2019

Figure 38: Indonesian Foreign Direct Investment (US$ Billion), 2010–2019

Figure 39: Indonesian Inflation Rate (%), 2010–2019

Figure 40: Indonesian Money Market Rate (%), 2010–2019

Figure 41: Indonesian Balance of Payments (US$ Billion), 2010–2014

Figure 42: Indonesian Government Debt as a Percentage of GDP (%), 2010–2019

Figure 43: Indonesian Stock Market Performance (Index), 2010–2014

Figure 44: Indonesian HNWI Wealth vs GDP Ratio (%), 2010–2019

Figure 45: Indonesian HNWIs – Volume by Wealth Band, 2010–2019

Figure 46: Indonesian HNWIs – Wealth by Wealth Band (US$ Billion), 2010–2019

Figure 47: Indonesian HNWIs – Wealth per Capita (US$ Million), 2010–2019

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