Wealth in the Philippines: Sizing the Market Opportunity; Sizing the wealth market in one of Asia’s fastest growing economies.

Pages: 37 Published: September 01, 2016 Report Code: VF0023CI

The Philippines is home to a relatively small affluent population, and the country’s financial services sector is somewhat unsophisticated relative to many of its ASEAN-6 neighbors and other developed nations. Retail participation in the equities and mutual fund markets is very low, with the bond market traditionally more popular but the majority of allocations still held in deposits. However, very strong economic performance over recent years and a new government committed to shaking off the image of the Philippines as the ‘sick man of Asia’ bodes well for the future of its financial services sector and the population’s financial literacy. Local wealth managers may not currently have a particularly large lucrative target market onshore, but this segment will grow significantly and wealth managers need to be ready to capitalize on the opportunity.


“Wealth in the Philippines: Sizing the Market Opportunity” analyzes the Filipino wealth and retail savings and investments markets, with a focus on the HNW segment. The report is based on our proprietary datasets.

Specifically the report:

• Sizes the affluent market (both by the number of individuals and value of their liquid assets) using Verdict Financial’s proprietary datasets.

• Analyzes which asset classes are favored by Filipino retail investors and how their preferences impact the growth of the total savings and investments market.

• Examines HNW clients’ attitudes towards non-liquid investments, such as hedge funds, property, and commodities.

• Identifies key drivers and booking centers for offshore investments by Filipino HNW clients.

Reasons to Buy

Benchmark your share of the Filipino wealth market against the current market size.

Forecast your future growth prospects using our projections for the market to 2020.

Identify your most promising client segment by analyzing the penetration of affluent individuals in the Philippines – both at country and regional level.

Evaluate your HNW proposition by understanding how regulation is affecting your HNW clients.

Review your offshore strategy by learning about HNW motivations for offshore investments and their preferred booking centers.

Table of Contents

Executive Summary

Key findings

Critical success factors

Sizing and Forecasting the Wealth Market in the Philippines

Affluent individuals account for just 1% of the adult Filipino population

The Philippines’ affluent population is still extremely small but there are signs of an emerging investor class

HNW investors account for less than

0.1% of the market and the very rich will get richer

Overall growth of total liquid assets has been highly variable in recent years

Wealth held by affluent investors has risen robustly, providing wealth managers with ample opportunities

Filipino HNW individuals hold over one third of total liquid assets, a share that will rise

Drivers for Growth in the Filipino Wealth Market

The retail savings and investments market will continue to grow strongly

Upgraded GDP forecasts and continued government investment will keep the retail market buoyant

The Filipino retail market is heavily weighted toward deposits

Bonds and mutual funds will show the strongest growth rates moving forward

Deposits will see slower but steadier growth, supported by benign inflation and moderate interest rates

The formalization of savings will ensure robust deposits growth

Bonds are significantly more popular in the Philippines than the rest of Asia

A stronger local sovereign debt market has fueled growth in bond holding

Equities and mutual funds are more closely aligned with the fortunes of the stock market

Filipino stock market performance has been extremely variable in recent years

The performance of the stock market also has a direct impact on equities

HNW Investment Preferences

Filipino HNW individuals keep the vast majority of their assets liquid

Property is the most popular HNW illiquid asset, reflecting a lack of local alternatives

Filipino HNW individuals hold

12.8% of their assets offshore

Access to more investment options and client anonymity are the top drivers of offshore investment

China and Hong Kong are now the most popular booking centers for Filipino HNW individuals


Abbreviations and acronyms

Supplementary data







Double Taxation Convention (DTC)


Exchange of information


Liquid assets

Mass affluent

Mutual funds




Verdict Financial's 2015 Global Wealth Managers Survey

Global Retail Investments Analytics methodology


Further reading

About Verdict Financial


List of Tables

Table 1: Income tax rates and income bands, 2016

Table 2: Philippines: number of affluent individuals by asset band (000s), 2011–15

Table 3: Philippines: number of affluent individuals by asset band (000s), 2016e–20f

Table 4: Philippines: value of liquid assets held by affluent individuals by asset band (000s), 2011–15

Table 5: Philippines: value of liquid assets held by affluent individuals by asset band (000s), 2016e–20f

List of Figures

Figure 1: Only 1% of the total Filipino population is affluent

Figure 2: Affluent individuals account for 94% of all onshore liquid assets in the Philippines

Figure 3: Growth in the total retail savings and investments market will remain buoyant at over 9%

Figure 4: Equity and mutual fund holdings account for minor shares of the total onshore market

Figure 5: Slower-growing deposits and equities will constrain growth

Figure 6: Deposits will see steadier growth, adding 54% over the next five years

Figure 7: Retail bond holdings will see strong growth return in 2016

Figure 8: The Philippines Stock Exchange has consistently performed well over recent years

Figure 9: Equity performance closely mirrors the PSE Index

Figure 10: Filipino retail mutual funds are well weighted in bonds

Figure 11: Property investments are the most popular illiquid asset among Filipino HNW individuals

Figure 12: Filipino HNW individuals allocate a modest share of their wealth offshore

Figure 13: Access to more investment options and client anonymity are the primary reasons Filipino HNW clients offshore wealth

Figure 14: China and Hong Kong are the booking centers of choice for Filipino offshore wealth

Figure 15: FATCA agreements have been signed across the world


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