The number of high net worth individuals in Mexico swelled 32 per cent in the five years to 2012 to reach 145,000, while global HNW volumes declined by 0.3 per cent, new figures show.

The number of high net worth individuals in Mexico swelled by 32 per cent in the five years to 2012 to reach 145,000, while the number of such persons around the world declined by 0.3 per cent, new figures show.

The HNW individuals in Mexico at the end of 2012 collectively had $736 billion, which equates to 43 per cent of total individual wealth held in the country, according to the report.

Meanwhile, the amount of wealth that HNW individuals kept outside of Mexico decreased from 23.2 per cent ($124 billion) at end-2007 to 21.9 per cent ($161 billion) at the end of 2012 - a sign that opportunities for wealth managers there are ripening. It may also suggest that offshore locations for Mexicans' wealth are becoming less successful in this regard. 

In related news, yesterday the Wall Street Journal reported that President Enrique Peña Nieto is looking to open the state-run oil and gas industry - which has been closed for nearly eight decades - to private investment and competition. The government hopes the move will attract "billions of dollars" in investment, the WSJ said, citing three high-level government and ruling party officials. 

Mexico is increasingly perceived as a place with good opportunities for wealth management players. In March, for example, Deutsche Bank brought in Raphael Zagury as head of key client partners and wealth investment advisory for Latin America - a newly-created role at the firm. Zagury will work with ultra high net worth clients in Latin America on investments, with Mexico and Brazil being key focuses, sources said.

Ultra high net worth growth

There are 2,540 ultra high net worth individuals in Mexico, as at the end of 2012, with $364 billion in total combined wealth. Of this total, there are 16 billionaires, 252 centimillionaires and 2,272 affluent millionaires, WealthInsight found.

Mexico City is home to just under half (43 per cent) of the country’s total UHNW population, with 1,088 individuals. Other places with a high UHNW count is Monterrey, with 208, and Guadalajara, with 129. 

“Mexico is a coveted market for most large US wealth managers with an interest in Latin America,” Isaac Barrocas, senior director at BNY Mellon International Wealth Management, recently told Family Wealth Report. “The demographics of the population have shown very positive shifts in recent years, with a growing middle class (view feature here).”

According to Henderson Global Investors, the investment appeal of Mexico is underrated and the country should continue to benefit from its proximity to the US. The country’s economy grew by 3.9 per cent in 2012 and has expanded more rapidly than that of the US in recent years, Henderson said.

Figures from the CIA show that Mexico's economy is the world's 12th largest; the country has an estimated GDP for 2012 of around $1.76 trillion (on a PPP basis). Brazil is the eighth largest, at $2.36 trillion.