With net financial assets in Taiwan rising 8.4 percent annually to 97,850 euros (US$108,300) per capita last year, Taiwan overtook Japan for the first time and was the second-richest in Asia behind only Singapore, the Allianz Group’s global wealth report published on Thursday showed.
That was 1,540 euros higher than Japan’s net financial assets per capita of 96,310 euros, but still 2,520 euros lower than Singapore’s 100,370 euros, the report showed.
Although the number might seem too high given that gross national income per capita stands at NT$768,959 (US$24,821), according to data provided by the Directorate-General of Budget, Accounting and Statistics (DGBAS), Allianz Taiwan Life Insurance Co (安聯人壽) said the average was boosted by the financial investments of very rich people.
Financial assets include cash, bank deposits, gains from insurance companies and pension institutions, securities (shares, bonds and investment funds) and other income, Allianz Taiwan Life Insurance said.
Worldwide, Taiwan climbed four spots to fourth last year, its highest in the past decade, with the US leading with net financial assets of 184,410 euros, followed by Switzerland (173,840 euros) and Singapore, the report showed.
While global gross financial assets fell last year for the first time since the financial crisis in 2008 with a drop of 0.1 percent, Taiwanese households bucked the trend, with their financial assets advancing 5.1 percent year-on-year, the report found.
Their average insurance and pension incomes posted the strongest growth of 9.8 percent among all assets, compared with securities’ increase of 3.7 percent and bank deposits’ mild gain of 3.4 percent, the report said.
Savers worldwide have found themselves in a bind, due to the US-China trade dispute, tightening of monetary conditions and the normalization of monetary policy, the report said.
As the central bank has kept its key interest rates unchanged since September 2016, many local investors have given bank deposits the cold shoulder and turned to insurance policies for higher returns, Allianz Taiwan Life Insurance spokesman Kirk Cheng (鄭祥琨) said by telephone on Thursday.
That explains why Taiwan’s insurance penetration rate remains at nearly 20 percent, the highest in the world, Cheng said.
Allianz’s total premiums rose 19 percent annually last year, with half of them coming from interest-sensitive policies, which usually give policyholders higher returns, he said.
Taiwanese households reported an average liability growth of 4.5 percent, mainly driven by rising home prices, but their gross financial assets still outpaced their loans, the report showed.
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