HONG KONG - The population of high net worth individuals (HNWIs) in Asia-Pacific grew 9.3 percent to 3.3 million in 2010, surpassing Europe's for the first time and placing the region as the world's second-biggest market after North America, according to report released here Thursday by Merrill Lynch Global Wealth Management and Capgemini.

The 2011 Asia-Pacific Wealth Report showed that Asia-Pacific HNWI wealth gained 12.1 percent to $10.8 trillion in 2010. With the fastest regional growth rate, the number of Ultra- HNWIs in Asia-Pacific rose 14.9 percent to 23,000, while their wealth jumped 16.8 in the same period.

The report defined the HNWIs and Ultra-HNWIs as those having investable assets of at least $1 million and at least $30 million respectively, excluding primary residence, collectibles, consumables and consumer durable.

In 2010, the growth rate of Hong Kong's HNWI population as well as wealth was the fastest in the world, with 33.3 percent and 35 percent separately, the report said.

"Wealth accumulation in Hong Kong continued on a strong trajectory last year, building on 2009's robust base," said Wilson So, head of North Asia Advisory at Merrill Lynch Global Management, adding "despite recent dislocations in the global market, the long- term fundamentals of Hong Kong's economy remain solid and will help investors withstand any volatility ahead."

The report indicated that Asia-Pacific HNWI wealth and population were still highly concentrated. Japan, the Chinese mainland and Australia accounted for 74.4 percent of the HNWI population and 68.2 percent of wealth in the region in 2010.

In terms of investment, HNWIs in Asia-Pacific continued to favor equities and real estate. They ended 2010 with 27 percent of their assets in real estate. Across the region, the majority of HNWIs allocated the biggest single share of real estate holdings to residential investment. In the Chinese mainland, the proportion was 70 percent.

Equities accounted for 26 percent of their investment in 2010, said the report. The Chinese mainland's HNWIs has 42 percent of their holdings in equities, far higher than the global average.

The report expected that Asia-Pacific excluding Japan is to remain the engine of global economic growth in 2012. But the actions of the Asia-Pacific governments take to restrain inflation, control capital inflow and deflate potential asset bubbles will certainly affect the pace of the expansion.

According to the analysis, Asia-Pacific HNWIs are likely to increase their exposure to equities and fixed-income holdings while cutting the amount held in cash and real estate.

As part of Bank of America Corporation, Merrill Lynch Global Wealth Management is a leading provider of wealth management and investment services for individuals and businesses globally. Capgemini is one of the world's foremost providers of consulting, technology and outsourcing services.