The report, published by the Boston Consulting Group, found that Switzerland is currently the largest offshore centre, with a 24% share – or $2.4trn (£1.8trn, €2.1trn) in assets, twice as much as Singapore.
However, Switzerland’s share of offshore wealth is projected to decline through 2021.
Meanwhile, offshore assets in Singapore and Hong Kong are likely to climb 8% and 6% respectively, because of their status as the “preferred booking centers for regional clients and the anticipation of strong growth in Asia-Pacific”, said BCG.
The growth in offshore wealth in Singapore and Hong Kong is primarily down to Asia-Pacific once again being the fastest-developing region, with nearly double-digit growth in global private wealth of 9.5%.
Investors in Asia-Pacific remained the largest source of global offshore wealth in 2016, with $2.9trn placed in offshore booking centres.
BSG added that despite the expected merging of offshore and onshore margins, “offshore bookings will remain a key growth opportunity”, particularly in the upper high net worth and ultra high net worth market.
Global private wealth
According to the report, global private financial wealth grew by 5.3% in 2016, to $166.5trn, driven by accelerating economic growth and the strong performance of equity markets in many parts of the world.
Western Europe posted modest growth (3.2%), which BSG said was linked to uncertainty over Brexit.
By the end of 2017, the level of private wealth in Asia-Pacific is projected to surpass that in Western Europe, and by 2019, the combined level of private wealth in Asia-Pacific and Japan is projected to surpass that in North America.
Meanwhile, Middle East and Africa rebounded strongly, with private wealth rising 8.5% to $8.1trn in 2016, with the richest country in the region, Saudi Arabia, posting moderate wealth expansion.
News source: International Adviser