Singapore households ranked second richest in Asia

Thanks to securities market recovery.

Allianz published in Singapore the fourth edition of its "Global Wealth Report", which puts the asset and debt situation of private households in more than 50 countries under the microscope..

“Taking net financial assets per capita as the yardstick, Singapore’s households remained the second richest in the region after Japan despite the below average growth of their gross financial assets of 10.4%,” said Michael Heise, Chief Economist at Allianz.

The main driver of this growth was the recovery of the securities market; however, the Straits Time Index was still below its 2010 level at the end of 2012. Life insurance and pension fund assets remained the most important asset class in the average household’s portfolio.

This is insofar not surprising as the Singaporeans will have to rely heavily on capital-funded old-age provision in the future, being one of the most rapidly ageing societies of the world. However, the picture gets blurred when credit growth is included in the analysis.

During the past three years, liabilities grew more strongly than assets, with two thirds being mortgage loans. This development reduced net financial assets growth in 2011 to a mere 2.6% and to 10.2% in 2012.

With the population still increasing, year-on-year per capita growth was reduced to 7.9%, translating into average net financial assets per capita of EUR 66,400.