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Top 1000 World Banks – A familiar tale as Asia takes lion's share of Tier 1 capital

Asia's position as the leading region by total Tier 1 capital and the number of banks present in the Top 1000 ranking remains unchanged, with Chinese lenders leading the charge.
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The banking story of the past few years – Asia gains, Europe loses – continues in this year’s rankings. In the 2014 Top 1000 World Banks ranking, Asia-Pacific’s share of global Tier 1 bank capital was 35.96%; in 2015 this figure has risen to 38.65%, an increase of 2.69 percentage points.

Global structure share of global Tier 1 bank capital

By contrast, western Europe has lost 3.18 percentage points from 33.78% in the 2014 ranking to 30.60% this year, while central and eastern Europe has fallen from 2.21% to 1.67% – a 0.54 percentage point drop.

But not all parts of Asia-Pacific are driving this growth equally. This year, the bank numbers and percentage shares have been broken down so that China and Japan are in separate categories, leaving the rest of the Asia-Pacific region on a standalone basis.

In fact, the number of Japanese banks in the Top 1000 has dropped from 94 to 89, with the two heavyweights of Japanese banking – Mitsubishi UFJ and Mizuho – both recording reductions in Tier 1 capital, at least in dollar terms, of 2.51% and 6.7%, respectively. In fact, as the yen fell 17% against the dollar, the true capital position of these two banks improved.

Chinese banks are the big drivers in Asia’s continuing outperformance and, as the renminbi more or less tracks the dollar, there is little in the way of currency impact on the results. The number of Chinese banks in the Top 1000 ranking rose from 111 to 117, giving China a 20.95% share of global banking, only a slither behind that of North America with 21.03%. The number of banks in the rest of Asia-Pacific increased from 150 to 157.

North America also improved its position, with the number of regional banks increasing from 163 to 172 and its percentage of Tier 1 capital figure increasing by 0.91 points.

Europe went backwards not only in terms of Tier 1 capital share but also in terms of number of banks. The western European total fell from 233 to 222 and the central and eastern Europe number from 53 to 46 as the eurozone crisis continued to take its toll on the two regions’ banking sectors.

The rest of the world excluding Asia, North America and Europe still only accounts for a fraction of the total. Africa, the Middle East and Central and South America combined still only chalk up a little over 8% of global Tier 1 capital, almost exactly the same as the figure in our 2014 ranking. To be precise, this year the total is 8.07% against 7.94% last year.

Within this aggregate figure Africa edged up slightly from 0.94% to 0.99%, as did the Middle East from 3.77% to 3.88%, while Central and South America fell back a fraction from 3.23% to 3.2%. With regards to the number of banks, Africa added six, the Middle East lost three and South America dropped two. The world of banking is changing, albeit rather slowly. 

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