Millionaires in China to nearly double by 2025: Credit Suisse

The number of millionaires in mainland China grew by 35% in 2020, while the number of millionaires in Hong Kong fell by 7%, according to a new report from the private bank.
Millionaires in China to nearly double by 2025: Credit Suisse

Mainland China is projected to nearly double its number of high-net-worth individuals in the coming five years, giving rise to demand for private wealth and family office services in the Asia Pacific region.

Ranked second globally in terms of the number of millionaires behind the US, mainland China had 5.3 million millionaires in 2020, accounting for 9.4% of the world’s total, according to the Credit Suisse Global Wealth Report 2021 released on Tuesday (June 22).

By 2025, that number is expected to grow 92.7% to reach 10.2 million, closing the gap between China and the US, which is projected for a more modest 27.8% increase in the number of millionaires to reach 28 million.

“China and India, they loom very large in all our conversations... One of the predictions we're making for China, which is in particularly interesting, that we're expecting by 2025, that China may have wealth per adult of more than $100,000, which would put it in the high wealth category,” Anthony Shorrocks, economist and report author, said during a media briefing to present the findings.

“China and India started the century, both in the low wealth category in our classification system under $5000. So this transformation, if it occurs, within the course of 25 years, it's going to be astonishing,” he said.

Total wealth in mainland China grew by $4.2 trillion or 6%, but wealth in India fell by $593 billion or 4.4%.

“Some of these differences have to do with exchange rate effects, but also with how financial markets and especially the equity markets are composed from sector to sector,” said chief investment officer for international wealth management Nannette Hechler-Fayd’herbe during the briefing.

“So what this equity market is then implying in terms of financial asset growth is very different from what is happening in markets that are differently composed,” she added.

Asia's growing wealth "points to more need for professional institutional-level wealth management, which often involves setting up family offices on the principal’s side and a framework of collaboration with investment professionals," Hechler-Fayd'herbe told AsianInvestor.

"Resources vary tremendously from one family office to another so for some sharing best practices around governance, staffing and investment process will be key. For other larger and more mature family office structures, more specialised access to investment products and opportunities for example in private markets will be key," she said.

She added that sustainability, philanthropy and technology are areas that ultra-high-net-worth investors will be interested in. 


The report also found that portfolio composition and income shock were the main factors that had the most impact on wealth totals during the pandemic. Individuals with a higher share of equities – which include late middle-aged individuals, men and wealthier groups – as well as homeowners fared better, the report found.

Last year, there was "an increase of equity allocations through drift effects (equities holdings worth more) as well as re-allocations towards equities," Hechler-Fayd'herbe told AsianInvestor.

"But many investors remain below the strategic equity allocations consistent with their investment objectives and risk tolerances. Generally speaking there is interest among investors for any category of real assets including collectibles, real estate which serve as stores of value."

The report found that even though equity and home prices fell in the first half of 2020 they rebounded by the second half, particularly in countries that faced the most economic hardship.

“Most likely, it is testament to the success of government support programs and lower interest rates following central bank intervention,” the report wrote.

In Hong Kong, the number of millionaires fell to 520,000 in 2020 from 560,000 in 2019. Asked whether the decline in millionaires in Hong Kong was because of a decline in asset value or from high-net-worth investors leaving the city due to political tensions, Shorrocks told AsianInvestor: “The wealth data for Hong Kong is very poor. Our estimates show that wealth per adult dropped from $529754 in 2019 to $503335 in 2020. I do not know offhand the precise reason for this drop, but this is why the estimated number of millionaires went down.”

However, the number based in Hong Kong is projected to grow 59.8% in the next five years, leaving the city with 831,000 millionaires by 2025. Over the same period, the number in Singapore is projected to grow 61.9% to reach 437,000.


Even though wealth grew globally by $28.7 trillion to reach $418.3 trillion, inequality also rose in all countries during 2020 except in the US.

In China the Gini coefficient, used to measure inequality, increased from 59.9 in the year 2000 to 70.4 last year. In India, the index rose from 74.7 to 82.3 over the past two decades.

“Increasing inequality is perhaps not so surprising in China's context, because we start from a country in transition, which had very little private wealth, and that expanded so fast. So there are understandable reasons why inequality would have risen in China,” Shorrocks said.

“Of course, China is now more biased towards financial wealth. and India still has a very large agricultural sector where real wealth land holdings are very important. So that's another difference between the countries."

Shorrocks added that both countries were affected by the pandemic but China managed to overcome the situation early on. And while the Chinese economy has been “fairly resilient”, both have been affected by global reductions in GDP.

This article has been updated with a response from Anthony Shorrocks about the reason for Hong Kong's decline in the number of millionaires.

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