Only 14 new banks from 10 countries joined the Top 1000 World Bank ranking in 2021, the lowest number of arrivals seen in more than a decade and less than half of the new entrants compared to last year. This is indicative of a low level of merger and acquisition activity among the world’s largest banks.
The Asia-Pacific region is well represented in the new arrivals table with seven banks, five of which come from China.
The highest new entrant is the country’s Mengshang Bank, which jumps into the Top 1000 ranking at 394th position, with $3.1bn in Tier 1 capital. The bank took over the assets and operations of Baoshang Bank, an Inner Mongolian commercial lender that had been struggling for years. It had not filed an annual report since 2017 before the China Banking and Insurance Regulatory Commission (CBIRC) stepped in to rescue it in mid-2019.
State-owned China Construction Bank was appointed to oversee operations through Baoshang’s reorganisation. State investors including a national deposit insurance fund managed by the central bank and the government of the Inner Mongolia autonomous region took part in the restructuring.
Compatriots Foshan Rural Commercial Bank, from the central Guangdong Province, is the third largest arrival, with $2.4bn in Tier 1 capital and sitting in 480th position in the global ranking, followed by the Bank of Tibet, which was established in 2012 in the autonomous region, and Ningbo Commerce Bank, located in the eastern province of Zhejiang. The two Chinese banks entered the global ranking in 694th and 696th place, respectively, both with Tier 1 capital of around $1.3bn.
New arrivals
World Rank | Bank Name | Country | Tier 1 Capital $m |
394 | Mengshang Bank | China | 3,121 |
464 | KakaoBank | South Korea | 2,529 |
480 | Foshan Rural Commercial Bank | China | 2,393 |
694 | Bank of Tibet | China | 1,299 |
696 | Ningbo Commerce Bank | China | 1,289 |
717 | Equitable Bank | Canada | 1,239 |
889 | WiZink Bank | Spain | 742 |
904 | OakNorth Bank | UK | 705 |
932 | XW Bank | China | 659 |
957 | Sparebank 1 BV | Norway | 613 |
962 | Orient Bank | Vietnam | 601 |
967 | NCBA | Kenya | 594 |
969 | Banco Inter | Brazil | 592 |
989 | The Bancorp | US | 561 |
Online challengers
Chinese digital challenger XW Bank enters the Top 1000 ranking at 932nd position, with $659m in Tier 1 capital. With a year-on-year rise of 45.3%, the internet bank also made it into the top 25 highest movers’ table. Founded in 2016, XW Bank is based in Sichuan province and backed by Chinese electronics company Xiaomi and conglomerate New Hope Group.
With an open banking model, the internet bank offers tailored financial products such as entrepreneur loans and micro, small and medium-sized enterprise (SME) loans. However, it has come under regulatory scrutiny in March this year, when the CBIRC criticised it for high interest rates on loans and failing to follow risk assessment and debt collection regulations.
South Korea’s KakaoBank takes second place in the new arrivals table, with $2.5bn in Tier 1 capital, and joins the Top 1000 in 464th place. Launched in mid-2017 as one of the country’s first digital banks, KakaoBank offers consumers online/mobile-only banking services. It has $24.5bn in assets, expanding its asset base by 24.8% year-on-year.
At a time when challenger banks are being criticised for operating in the red and prioritising growth over profitability, both XW Bank and KakaoBank recorded pre-tax profits of $120m and $112m, respectively, in 2020.
Vietnam’s addition to the Top 1000 in 2021 is Orient Commercial Bank, which enters in the ranking at 962nd place. In early 2020, Japanese commercial bank Aozora Bank invested $138m to acquire a 15% stake in the mid-sized Vietnamese lender.
The western European region saw three banks join the ranks of the Top 1000: online retail bank WiZink Bank of Spain, in 889th place with $742m in Tier 1 capital; UK SME challenger OakNorth Bank, in 904th place and $705m in Tier 1 capital; and Sparebank 1 BV, a Norwegian savings bank, in 957th place with $613m in Tier 1. Of the three, WiZink Bank increased its Tier 1 by the biggest margin, rising by 25.7%, while OakNorth increased its asset base the most, by 15.7%.
In the Americas, Brazilian digital bank Banco Inter entered the exclusive Top 1000 club, at 969th place. Launched in 1994, it operated as Banco Intermedium until 2017. The bank caters to both private and business customers and, despite a challenging domestic environment, managed to add 12.6% to its Tier 1 capital. Canada’s Equitable Bank, which provides residential and commercial real estate lending services, as well as personal banking through its direct banking brand EQ Bank, also had its premiere in 2021, coming in at 717th place. The lender increased its Tier 1 by 15.9%, to $1.2bn.
Last year, 19 US institutions joined the Top 1000 ranking, constituting more than half of the 33 new entrants; however, this year the country added only one: The Bancorp Bank. Based in Delaware, the bank serves non-bank financial service companies, ranging from entrepreneurial start-ups to those on the Fortune 500. It joins in 989th position, increasing its Tier 1 capital by 17.9%, to $561m.
Kenya also added one bank to the Top 1000 in 2021 — NCBA Bank. With $594m in Tier 1 capital and placing 967th in the main ranking, NCBA Bank has assets worth $4.8bn and generated profits of $46m in 2020.
Returning number stable
While the number of new arrivals may have dramatically reduced year-on-year, the number of banks being welcomed back into this exclusive Top 1000 group has remained about the same. Last year, 36 institutions made a reappearance after a short absence, while this year there are 31.
The country fielding the largest number of returners is India, with 13 banks back in the ranking in 2021. In 2020, 24 Indian banks were unable to provide data for our analysis and therefore could not be included in the ranking. Three of the largest returners are from India: Bank of Baroda (ranked 152nd), Union Bank of India (199th) and Canara Bank (214th). But this list also includes longstanding members of the Top 1000 club, such as Bank of India, Indian Bank, IDBI and Bandhan Bank.
Last year, China had the greatest number of banks returning to the ranking, whereas India had none. This year, four Chinese banks have also come back into the fold: Chengdu Rural Commercial Bank, Hubei Bank, Wuhan Rural Commercial Bank and Hankou Bank. Like their Indian counterparts in the welcome back table, they were unable to submit end-of-year financial data for our analysis last year.
Germany has three banks in the welcome back table — Frankfurter Volksbank, Berliner Volksbank and BB Bank — whereas last year it had none.
In 2020, we lost 10 Lebanese banks from the Top 1000 global ranking. The country’s banking industry faced serious economic headwinds and political turmoil throughout 2019, which carried into 2020. We are pleased to see Bank Audi back in the ranking in 2021 — the highest ranking non-Asian bank to rejoin in 372nd place — and look forward to including more Lebanese banks in future.
Welcome back
World rank | Bank Name | Country | Tier 1 Capital ($m) |
152 | Bank of Baroda | India | 11,762 |
199 | Union Bank of India | India | 7,767 |
214 | Canara Bank | India | 7,270 |
231 | Chengdu Rural Commercial Bank | China | 6,734 |
294 | Bank of India | India | 4,904 |
297 | Indian Bank | India | 4,842 |
336 | Hubei Bank | China | 3,951 |
359 | Wuhan Rural Commercial Bank | China | 3,535 |
364 | Hankou Bank | China | 3,481 |
372 | Bank Audi | Lebanon | 3,296 |
430 | IDBI | India | 2,848 |
445 | Dukhan Bank | Qatar | 2,724 |
494 | Bandhan Bank | India | 2,296 |
585 | Frankfurter Volksbank | Germany | 1,742 |
600 | Berliner Volksbank | Germany | 1,673 |
629 | Crelan | Belgium | 1,558 |
631 | UCO Bank | India | 1,553 |
712 | Bank of Maharashtra | India | 1,246 |
749 | Farmers & Merchants Bank of Long Beach | US | 1,141 |
756 | BB Bank | Germany | 1,111 |
799 | Punjab & Sind Bank | India | 985 |
823 | Karur Vysya Bank | India | 913 |
850 | Karnataka Bank | India | 835 |
857 | South Indian Bank | India | 820 |
880 | Banca Agricola di Ragusa | Italy | 779 |
887 | Banco Credicoop | Argentina | 751 |
890 | Bank of Sharjah | United Arab Emirates | 742 |
919 | State Savings Bank of Ukraine | Ukraine | 686 |
974 | Banco Finantia | Portugal | 584 |
982 | Vietnam International Bank (VIB) | Vietnam | 576 |
983 | Banque Internationale Arabe de Tunisie | Tunisia | 576 |