China Construction Bank (CCB) is the most efficient lender among the top 50 lenders of The Banker's Top 1000 World Bank ranking for 2019, with a 24.75% cost-to-income ratio, an improvement of 0.61 percentage points on its previous performance. It has ousted previous number one Shanghai Pudong Development Bank, which loses the top spot by a whisker with a 24.76% efficiency ratio, 0.9 percentage points higher than in the 2018 ranking.
While Shanghai Pudong inverted the downward trend that had steadily reduced the cost-to-income coefficient up to 2018, CCB held steady in its trajectory. Its total operating income grew to $92.54bn in 2018 while operating costs dropped marginally to $22.9bn. The achievement is all the more striking considering the size of CCB, the second largest bank in the world by Tier 1 capital.
In fact, the four largest names in the Top 1000 World Banks ranking all feature in the efficiency table, and all are from China. Conversely, none of the US groups that appear in the higher echelons of the global ranking appear in the list. JPMorgan, Bank of America, Wells Fargo and Citigroup, which occupy the next four positions in the Top 1000, display cost-to-income ratios ranging between 57.63% and 64.15%.
Just as the top two banks in the cost-to-income ratio ranking have switched places, so too have Industrial Bank and ICBC – the former rising to third place from fourth. China Everbright Bank rises to fifth, while China Merchants Bank drops to eighth. The ranking seesaw continues in sixth and seventh places, where China Minsheng Bank leapfrogs China Citic Bank.
Though China dominates the table, it is one of only two emerging markets present, with Russia being the other. Moscow-based Sberbank is in ninth place with an improved 31.28% ratio.
Australia’s Westpac Banking Corporation and Commonwealth Bank lie in 13th and 14th place, respectively. A third Australian name, ANZ Banking Group, is in 17th place. Canada, which had no lenders in the 2018 ranking, has made the cut this year thanks to Scotiabank and Toronto Dominion Bank, which sit in 18th and 20th place, respectively, and which have both improved their efficiency ratios.
There is also an improved position for Spain’s Banco Santander and BBVA, which rise to 15th place from 17th, and 16th from 19th, respectively.
Lloyds Banking Group is the only UK name in the ranking. However, its cost-to-income ratio worsened in 2018, by 8.24 percentage points to 50.06%, because of lower operating income and higher costs. This has caused it to drop three places to 19th position.
While the space between the two leading names’ ratios has narrowed, the gap between the top and the bottom of the list has widened. China Construction Bank’s efficiency ratio is less than half that of Toronto Dominion Bank’s 52.03%, a difference that is 4.71 percentage points larger than that of the 2018 ranking.
Best Cost-To-Income Ratios of Top 50 Banks Worldwide
| Rank | World Rank | Bank | Country | Cost income ratio (%) |
| 1 | 2 | China Construction Bank | China | 24.75 |
| 2 | 24 | Shanghai Pudong Development Bank | China | 24.76 |
| 3 | 23 | Industrial Bank | China | 26.25 |
| 4 | 1 | ICBC | China | 26.78 |
| 5 | 39 | China Everbright Bank | China | 28.57 |
| 6 | 28 | China Minsheng Bank | China | 29.80 |
| 7 | 26 | China Citic Bank | China | 30.05 |
| 8 | 19 | China Merchants Bank | China | 30.53 |
| 9 | 32 | Sberbank | Russia | 31.28 |
| 10 | 4 | Bank of China | China | 32.32 |
| 11 | 3 | Agricultural Bank of China | China | 32.79 |
| 12 | 11 | Bank of Communications | China | 34.45 |
| 13 | 47 | Westpac Banking Corporation | Australia | 38.61 |
| 14 | 45 | Commonwealth Bank | Australia | 41.71 |
| 15 | 15 | Banco Santander | Spain | 42.01 |
| 16 | 33 | BBVA | Spain | 42.59 |
| 17 | 49 | ANZ Banking Group | Australia | 42.91 |
| 18 | 48 | Scotiabank | Canada | 49.38 |
| 19 | 37 | Lloyds Banking Group | UK | 50.06 |
| 20 | 42 | Toronto Dominion Bank | Canada | 52.03 |
