Personal wealth in Qatar seen growing at 8% to $270bn in investible assets by 2022: BCG

Personal wealth in Qatar is expected to grow at a compound annual growth rate (CAGR) of 8% to $270bn in investible assets by 2022, according to the Boston Consulting Group (BCG). The BCG said in a report that personal wealth in Qatar had grown 9% during 2016-17, primarily driven by the positive development of life insurance and pensions. It found that the Middle East accounted for the highest share of wealth held in investable assets with Qatar’s investable wealth projected to grow at a CAGR of 7% by 2022.

Qatar’s non-investible assets are expected to increase at a CAGR of 23% in the next five years, while investible wealth growth is projected to accelerate at a CAGR of 7%, said Markus Massi, senior partner and managing director of BCG Middle East’s Financial Services practice. Regarding asset allocation, currency and deposits, at 45%, were the highest proportion of assets in Qatar in 2017; followed by offshore assets at 41%; equities and investment funds at 10%; and life insurance and pensions at 3%. “By 2022, currency and deposits, and life insurance and pensions are expected to experience slight growth to 53% and 5% respectively. For offshore assets, and equities and investment funds will experience a decline to a respective 36% and 6% respectively,” Massi said.

 

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Massi: Positive outlook.

At 24%, life insurance and pensions drove growth by asset class between 2016 and 2017 in Qatar. The other drivers of asset class growth included currency and deposits at 21%, and offshore assets at 5%. In Qatar, equities and investment funds and bonds experienced decline of 16% percent and 2% percent respectively. “Looking to the future, growth by asset class is expected to experience a slightly slower, but steady growth with life insurance and pensions at 23%, and currency and deposits at 11% CAGR over the next five years,” BCG said.

In the same period, growth in offshore assets will remain constant at CAGR of 5% and equities and investment funds and bonds will decelerate by 2% CAGR and 1% CAGR respectively, it said.While offshore share is expected to decline over the next five years from 41.4% in 2017 to 35.5% in 2022, it will continue to grow at a CAGR of 4.6% to reach $95bn in Qatar in the same period, according to the BCG. Otherwise, personal wealth in the Middle East rose 11% to $3.8tn in 2017, a significant increase compared with growth in the previous five years, it said.

Sources and photo-credits: Gulf Times