Top 25 Global Banks by Tier 1 Capital

by: David Hunkar

The Banker magazine has released the Top 1000 world banks for 2009 based on their Tier 1 capital. The following are the Top 25 from the rankings:

Rank Bank Country Ticker
1 JP Morgan Chase & Co US JPM
2 Bank of America Corp US BAC
3 Citigroup US C
4 Royal Bank of Scotland UK RBS
5 HSBC Holdings UK HBC
6 Wells Fargo & Co US WFC
7 Mitsubishi UFJ Financial Group Japan MTU
8 ICBC China
9 Credit Agricole Group France
10 Santander Central Hispano Spain STD
11 Bank of China China
12 China Construction Bank Corp China
13 Goldman Sachs US GS
14 BNP Paribas France BNPQY.PK
15 Barclays Bank UK BCS
16 Mizuho Financial Group Japan MFG
17 Morgan Stanley US MS
18 UniCredit Italy
19 Sumitomo Mitsui Financial Group Japan SMFJY.PK
20 ING Bank Netherlands ING
21 Deutsche Bank Germany DB
22 Rabobank Group Netherlands
23 Societe General France SCGLY.PK
24 Agricultural Bank of China China
25 Intesa Sanpaolo Italy IITSF.PK

The Top 3 ranked banks are the US-based banks, with JPMorgan Chase (NYSE:JPM) being the number one bank. The other two US banks are Bank of America (NYSE:BAC) and Citibank (NYSE:C). Wells Fargo & Co. (NYSE:WFC) of the US was ranked number six. British banks Royal Bank of Scotland (NYSE:RBS) and HSBC Holdings (HBC) took the fourth and fifth spots. China’s ICBC is the only emerging market to be appear in the Top 10. Other Chinese banks in the Top 25 list include Bank of China, China Construction Bank Corp and Agricultural Bank of China. This shows the strength of Chinese banks among global banks and also the growing importance of China in the world economy.

Western banks still dominate the top 25 rankings list despite huge losses due to the credit crisis. This is due to their massive recapitalization with government aid or raising capital from the markets. Some of the key points from the Banker magazine report are:

  • Total profits of the top 1000 ranked banks plunged 85.3% from $780bn to $115bn
  • Return on capital sank from 20% in 2008 to a paltry 2.69%
  • Total Tier 1 capital has risen 9.7% to $4276bn
  • Assets have grown by 6.8% to $96,395bn

The worst losses in 2008 were incurred by Royal Bank of Scotland, Citibank and Wells Fargo. Among the western countries, “US banks made an aggregate loss of $91bn, the EU 27 an aggregate loss of $16.1bn, and the UK’s banks lost, on aggregate, $51.2b.” Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) were listed in this ranking since they converted to be bank holding companies last year.