Megawealthy Japanese will contribute to a more than 30% surge in the value of assets they invest by the end of the decade as cash-heavy households deploy more in markets, according to an analysis by Morgan Stanley.
The investments by the combined segment of ultra-high-net-worth individuals and the “upper affluent” will reach 906 trillion yen ($5.8 trillion) by 2030, up from the current 690 trillion yen ($4.4 trillion), the report on the country’s wealth transition found.
That backdrop provides a sales opportunity for the nation’s financial firms that's worth around $38 billion, according to the report. Banks and brokerages in Japan are turning to wealth management as a key pillar of growth for the future just as a rally in the stock market and the end of the Bank of Japan’s negative-interest-rate policy signal a revitalized interest in the nation’s assets.
Young affluent Japanese were singled out as a particular source of potential growth.
“As this group increases its wealth and its portfolio needs get more sophisticated, we think that mutual fund inflows could be significant in the longer term,” the group of strategists and analysts wrote in the May 16 report.