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Wealth in Indonesia: HNW Customers

Wealth in Indonesia: HNW Customers

Summary

Wealth in Indonesia: HNW Customers analyzes the profile of Indonesian HNW individuals, from their investments to product demand to sources of wealth. This report is based on our 2014 Global Wealth Managers Survey. The results of the survey are accompanied by best-practice case studies on how to target Indonesian HNW individuals where applicable.

Synopsis

  • Evaluate product and service demand among Indonesian HNW individuals from discretionary asset management to art advisory services to credit products.
  • Analyze the best method to capture new Indonesian HNW clients and how best to maintain communication during the client relationship.
  • Interpret the investment portfolios of Indonesian HNW individuals through detailed asset allocation analysis.
  • Understand the major sources of HNW wealth in Indonesia.
Reasons To Buy
  • How do Indonesian HNW individuals amass their wealth?
  • What investments make up a typical Indonesian HNW investment portfolio?
  • What wealth management products and services are in demand in Indonesia?
  • How often do Indonesian wealth managers contact their clients through email, social media, and face-to-face meetings?
  • How do Indonesian HNW individuals compare to their peers in Asia?
Key Highlights

Wealth managers in Indonesia primarily deal with family business owners and first-generation entrepreneurs. Wealth from these segments dominates the market, with very little coming from inheritance or as a result of running major businesses as an independent executive.

Indonesian HNW individuals have strong and growing demand for advisory asset management services. Demand for all planning services (except tax planning) is lower in Indonesia than the regional average, but this trend should reverse in the coming years.


  • Executive Summary
    • Indonesia's wealth market is dominated by successful business owners
    • Key findings
    • Critical success factors
  • Profiling the Indonesian HNW Client
    • The majority of Indonesian wealth is split between wealthy business families and new entrepreneurs
      • The primary industries still have a hold on wealth generation
    • Expats form only a small part of the HNW population
      • As Indonesia blossoms as an investment destination, the expat population will grow
      • Expats are primarily drawn from nearby nations
      • Retirement visas offer an alternative route to residency
  • Asset Allocation Trends Among Indonesian HNW Investors
    • Broad asset allocation is dominated by cash
      • The HNW market prefers to remain liquid and is heavily biased towards cash
      • Direct holdings are favored for basic investments, with funds reserved for adding liquidity to securities holdings
      • Liquidity coupled with hedging has resulted in a significant amount of deposits
    • Wealth managers anticipate growth in all asset classes over the next two years
      • Indonesian HNW individuals are eager to put their wealth to work investing in the local growth story
  • Product and Service Demand Among Indonesian HNW Investors
    • Asset management services
      • All asset management services have some appeal, but Indonesia is an advisory market
      • Looking forward, demand for execution-only investment services is expected to increase significantly
      • Indonesian wealth managers need to provide more information and control to their clients
    • Planning services
      • Financial planning is an essential service for all wealth managers
      • Financial planning is likely to remain key to local HNW individuals
      • Although demand for pensions planning is set to increase, take-up is currently limited
    • Credit products
      • Credit demand from HNW individuals is slightly above the regional average
      • Investments will be increasingly leveraged
    • Art advisory and philanthropy advice
      • Demand for niche advice services is moderate
    • Insurance
      • Insurance advice is a key element of what HNW investors want from their wealth managers
      • Rising demand for insurance makes protection advice a key area for investment
  • Customer Acquisition and Communication
    • Client acquisition
      • Internal referrals are a critical tool for client acquisition in Indonesia
    • Client communication
      • Frequent face-to-face interaction creates extra costs
      • HNW individuals in Indonesia are accustomed to being serviced onshore by high-cost service channels
      • Wealth managers should take the time to develop social media strategies
      • A slick mobile app is a hygiene factor in the Indonesian wealth market
  • Appendix
    • Abbreviations and acronyms
    • Definitions
      • Affluent
      • HNW
      • Liquid assets
      • Mass affluent
    • Methodology
      • Verdict Financial's 2014 Global Wealth Managers Survey
      • Verdict Financial's 2012 Global Wealth Managers Survey
    • Bibliography
    • Further reading

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