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HK millionaires - Numbers drop; average asset losses hit HK$1.2 mln
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It is being reported that Hong Kong star Jacky Cheung lost HK$40 million in 2008 because of an unwise investment in Lehman securities, and has had to return to the stage to earn money this year.

Citibank released the results of its survey of Hong Kong millionaires on February 19, 2009. "In 2008, the number of Hong Kong millionaires dropped by 66,000, with average current assets (funds, stocks, foreign exchange, debt and other current assets) shrinking by HK$1.2 million," Simon Chow told the 21st Century Business Herald on February 19. Chow is Deputy Country Business Manager, Citibank Global Consumer Group.

Financial turbulence in 2008 eliminated 16 percent of those who had previously figured on the Hong Kong millionaires list. Chow noted that the millionaires who had had the most were the biggest losers. According to the survey, millionaires with more than HK$5 million lost 36 percent of their assets in 2008; those with HK$2 to 5 million lost 10 percent, and people who owned HK$1 to 2 million lost 13 percent.

About 60 percent of the millionaires suffered losses on the stock market, with average losses amounting to HK$427,000. One-third experienced failure in investment funds, and about 20 percent saw losses on the foreign exchanges, with the respective average losses hitting HK$158,000 and HK$75,000.

The survey also shows that the number of investors in their 30s dropped by 6 percent compared with 2007, because many of these younger investors were following high-risk investment strategies. 83 percent of Hong Kong millionaires are now over-40s, people who were hit less hard by the financial crisis due to their more conservative investment strategies. Most of these had already experienced the last Asian financial crisis, and had stood the test of SARS, thus successfully remaining in the ranks of the millionaires. Chow pointed out that 47 percent are female and 53 percent male; 81 percent are married, and 72 percent have children.

It is notable that 80 percent of the millionaires belong to the following five groups: retirees, specialists, housewives, private managers, and top employees. Owning average net assets of HK$8 million, 75 percent of them do not require a salary. "Quite a lot of rich people live on Hong Kong Island, where one out of nine is a millionaire," Chou said.

The survey indicates that most Hong Kong millionaires are taking a prudent attitude towards future investments, but still have a degree of confidence. 74 percent are pessimistic about the property market in 2009, but 23 percent said they might buy houses this year. There has been speculation that some foreign-funded banks might withdraw capital from the Hong Kong market. Chou thought it was unlikely that Citigroup would do this, but it might fuse its Hong Kong banking business with its finance business.

(China.org.cn by Fan Junmei, February 23, 2009)

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