The U.S. is home to more dollar-based billionaires than any other country but China has cut into its lead, according to Swiss bank UBS Group AG’s annual report card on the state of the megarich.

Overall, global billionaire wealth increased by a record $1.4 trillion to $8.9 trillion in 2017, a year in which economies around the world grew at robust rates, equity markets soared and bond yields stayed low as central banks mostly maintained easy-money policies in an environment of low inflation.

The...