Among the usual jostling for position between banks on the soundness tables in the 2015 Top 1000 World Banks ranking, an interesting trend can be spotted – capital adequacy ratios seem to be falling among the highest ranked firms.
In the 2014 soundness rankings, Brazilian bank Banco Original was top of the Bank of International Settlements (BIS) ratio table with 74.5%, and Russia’s National Reserve Bank led the capital assets ratio (CAR) table with 81.31%. This year, the highest BIS ratio bank is Nederlandse Waterschapsbank with 70%, and the highest CAR ratio bank is the US’s Franklin Resources, with 53.01%.
A number of the strongest performers from the 2014 ranking have fallen away this year. Banco Original has dropped to seventh in the BIS table, and from second to fourth in the CAR table, while National Reserve Bank is nowhere to be seen in either table this year. In their stead have moved US firms such as Franklin Resources, and banks from Bahrain such as First Energy Bank, which moves from fourth to second in the CAR table despite having a marginally lower ratio this year.
On a regional basis, central Asian banks lead the way with an average CAR of 11.15%, whereas banks in Europe, which lead the way in total assets, lag behind with an average CAR of just 4.88%
