China’s wealth management market will reach $12 trillion of assets this year but easy pickings will be hard as competition heats up with new entrants, according to a report on the sector by Celent.

China’s wealth management market will reach $12 trillion of assets this year, up from $9.5 trillion two years ago but easy pickings will be hard as competition heats up with new entrants, according to a report on the sector by Celent, the consultancy and research house.

Private banking assets reached $547 billion in 2012, up from $300 billion in 2009; that figure will rise to $993 billion in 2015. In 2012, there were 1.74 million HNW individuals in China (financial assets of $1 million or more); this group is expanding at an annual rate of 17 per cent. Some 73 per cent of these people are business owners or higher management executives.

Such growth figures, while necessarily subject to uncertainties, such as a possible sharp correction to the Chinese economy, help explain why Western as well as domestic financial institutions are battling to grab market share.

Having been monopolised by banks for years, other institutions are breaking into the space, such as trusts, securities companies, fund managers, internet banking outlets and others, the Celent report said.

Another trend, the report says, is that as the clients of wealth management companies start to be more demanding, non-financial service industries will also get involved in the wealth management space; it also predicts that “high-end” family wealth management businesses will surface.

The report, entitled Trends In China’s Wealth Management Industry, looks at trading, asset management, marketing and technology trends in the sector.