Led by China, the Asia-Pacific region will surpass Western Europe this year as the world's second-largest wealth market behind North America.

Boston Consulting Group confirmed that the Asia-Pacific region will probably have wealth assets of about $42.3 trillion by the end of 2017, compared to $41.9 trillion for Western Europe.

The company separates Japan from the Asia-Pacific region.

China possesses the highest private wealth in the Asia-Pacific region and the second-highest worldwide, according to an annual wealth report that was released on Tuesday by the global management and consulting firm.

The United States and China have the most millionaire households in the world, the report said. The US has nearly 7.1 million and China is second with 2.1 million.

Japan, the United Kingdom and Canada round out the top five nations that are home to millionaire households.

Mariam Jaafar, the head of Boston Consulting Group's wealth-management practice in the Asia-Pacific region, noted that private financial wealth in the region grew 9.5 percent last year to $38.4 trillion.

That was the first time in five years that the region failed to post double-digit growth.

Jaafar still expects the Asia-Pacific region to be at the forefront of global wealth growth and creation over the next five years.

"Annual wealth growth (in the region) is expected to be at or near double-digit levels through 2021," she said.

The report shows that the wealthy in China and the Asia-Pacific region remain very conservative investors. About 65 percent of their assets are in cash and deposits with 12 percent in bonds and 23 percent in stocks. In North America, 70 percent of the assets of the wealthy are in stocks with 16 percent in bonds and 14 percent in cash and deposits.

Global wealth increased 5.3 percent last year to reach approximately $166.5 trillion and Boston Consulting projects global wealth will be at or exceed $223 trillion by 2021.