Forty years after BankAmerica topped The Banker's first global bank rankings in 1970, the US-based bank has once again taken the number one spot in 2010. While Bank of America, JPMorgan and Barclays all participated in 1970 and 2010, this 40th anniversary of the listings shows that much else has changed in the sector. The Banker's editor emeritus Stephen Timewell reports.
Signs of a general recovery in banking include the facts incurring losses are not recording them on the same scale as last year and that even the lowest Bank for International Settlement (BIS) capital ratios are higher than in 2009. The worst non-performing loan (NPL) percentages, on the other hand, are higher, suggesting that there is more pain to come.
Despite pulling itself out of the worst recession the country has seen since the Second World War, Japan remains a deeply troubled economy saddled with a fiscal position that has in recent months gone from bad to worse: indeed, so parlous is Japan's predicament that in June the country's new prime minister, Naoto Kan, warned that the once mighty Asian economy may be staring a Greek-style public debt crisis in the face.
The Banker collects cost/income ratio data from banks as a measure of efficiency among banks across the globe. While methodology among banks across regions varies and what is included can differ, we are attempting to provide a global picture of the measure.
Philippine National Bank maintains the highest disclosed non-performing loans (NPL) ratio in the Top 1000, at 51.63%, and Egypt’s Bank of Alexandria, the country’s sixth largest bank, has come in second with 26.07%. With three banks in the top 10 disclosed NPLs from Lebanon, led by Fransabank (24.71%), the Lebanese authorities are keen to maintain high levels of disclosure.
The geographical structure of the 2007 Top 1000 World Banks reflects the increasing size and role of Asian (excluding Japan) and Middle Eastern banks. Their numbers in the ranking have increased by 11 and 10 respectively to reach 174 from Asia and 93 from the Middle East.
The annual tussle in recent years between the US and Germany to produce the highest number of New Arrivals came to an abrupt end this year as China easily ousted them both. The overall number of newcomers dropped significantly to 46, compared with 54 in last year’s and 60 in the two previous listings.