Tassia Sipahutar, Jakarta – The financial assets of Indonesian households jumped almost three times between 2007 and 2012, but this upward trend was not enough to keep the country from loitering almost at the bottom of a new report on global wealth.

Indonesia was ranked ninth in 2012 among 10 Asian countries in terms of gross financial assets, with $280 billion (US$378.03 billion), or $1,120 per capita, said an Allianz SE report titled "Allianz Global Wealth Report 2013".

The report said Indonesia's assets grew by nearly one-third in 2012 from the previous year and almost three times from the previous five years due to higher securities and insurance ownership.

"One indicator of how developed a financial system is can be found in the composition of household portfolios. The lower the proportion of bank deposits, the more developed the capital market tends to be and the broader range of investment alternatives on offer," the report says.

In Indonesia's case, bank deposit ownership continued to dominate the portfolio, accounting for 53.3 percent of total gross financial assets, followed by securities with 30 percent and insurance and pensions with 16.7 percent.

Despite being the majority, the contribution of bank deposits last year was lower than 2011, when bank deposits made up 60 percent of the portfolio, while securities and insurance made up less than 10 percent each.

Malaysia's portfolio composition looked more balanced with insurance and pensions accounting for 36.4 percent, securities 33.4 percent and bank deposits 30.2 percent.

The report has always placed Japan at the top since it was first issued in 2010. But Japan's share in the financial wealth of the region has decreased from 62.3 percent in 2007 to 48.2 percent in 2012 because of Chinese households, which doubled their slice of the gross financial asset cake during the same period.

Indonesia, meanwhile, managed to up its share to 1 percent in 2012 from 0.4 percent in 2007. Overall, the total gross financial assets of all private households in the 10 Asian countries reached $29 trillion by the end of 2012, from $27.86 trillion in 2011.

"One thing is becoming more and more evident. Private wealth is immense in global terms and an increasing number of people across the globe are able to participate in it," Michael Diekmann, chairman of the board of Allianz SE management, wrote in the paper.

Standard Chartered Bank Indonesia economist Eric Sugandi acknowledged Indonesian households were still "conservative" in their investment attitudes, citing bank deposits' dominance in investment. "They aren't yet as advanced as in other countries. The new middle- class still tends to start by using banking products," he said on Friday.

However, he added it would not take the new generation too long to adapt to investment trends and that the growth rate would be higher in "late blooming" countries compared to advanced ones.

Similar to Eric, Dian Ayu Yustina, a Bank Danamon economist, said Indonesians still preferred low risk investments such as bank deposits. Even when considering the diversification of asset allocation, Indonesians would prefer to invest in property or gold, she added.

"Looking forward, if Indonesia's fundamentals are improved, such as stable interest rates, people's appetite for securities or insurance or pensions will definitely grow," Dian said. (asw)