Top 1000 World Banks - China overtakes western Europe in soundness stakes

As western Europe drops from first place in the light of a lower capital adequacy ratio, China improved its soundness by the largest margin. Kat Van Hoof reports.

by Kat Van Hoof

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Although the overall asset base in the Top 1000 ranking is shrinking, capital adequacy improved for the second year in a row. Tier 1 capital also declined in Africa, Latin America and the Caribbean, Japan and western Europe, but in most of these instances the decline in assets outpaced it.

Western Europe is unable to hold onto 2018’s good run and saw its average capital assets ratio (CAR) contract slightly to 5.45%. The region’s assets went down by 3.3% in 2018 and Tier 1 capital by 4.1%.

Previously home to the biggest cache of Tier 1 capital, western Europe has handed the baton over to China for the first time. China's Tier 1 capital went up by 5.6% in 2018 and assets grew by 0.7%. Out of all the regions, China improved soundness the most, with the average CAR going up 0.34 percentage points to 11.03%.

North America also had a relatively good year compared with other regions. Its CAR went down slightly on its 2017 figures, but it leapfrogged Africa into third place on a regional basis, preceded only by central and eastern Europe (CEE) and the Middle East in terms of average capital adequacy. The CEE increased its CAR by the second largest margin, from 10.87% in 2018 to 11.03%.

Bahrain’s First Energy Bank tops the CAR list for banks for the fourth time running, though it shaved 10 percentage points off of its CAR in 2018. In contrast, its closest rival, the US’s United National Corporation, marginally improved its CAR, narrowing the gap between the banks. African Bank storms up the list to fourth place, from ninth last year, while Briscoe Ranch, eighth in the 2018 ranking, drops out of the top 25 entirely.

Aggregate Indicators by Region (%)

World Region	Tier 1 Capital	Total Assets	Capital assets ratio (%)
Middle East	332,617	2,927,806	11.36
Central and Eastern Europe	149,697	1,357,569	11.03
North America	1,640,340	20,955,153	7.83
Africa	75,366	965,382	7.81
Latin America and Caribbean	183,649	2,393,828	7.67
China	2,171,448	29,224,676	7.43
Asia-pacific (excl CHINA /Japan), including Central Asia	931,386	12,993,035	7.17
Europe	2,119,471	38,901,869	5.45
Japan	687,592	13,081,658	5.26
Total	8,291,565	122,800,976	6.75

Top 25 by Capital to Assets Ratio

Rank	World Rank	Bank Name	Country	CAR (% latest)
1	969	First Energy Bank	Bahrain	65.35
2	590	United National Corporation	US	50.59
3	798	Banco Hipotecario del Uruguay (BHU)	Uruguay	46.41
4	885	African Bank	South Africa	31.54
5	680	National Bank of Umm Al Qaiwain	United Arab Emirates	29.96
6	473	Beal Bank	US	27.52
7	754	Export Import Bank of the Republic of China	Taiwan	24.60
8	687	GFH Financial Group	Bahrain	23.61
9	249	Bank Gospodarstwa Krajowego	Poland	21.56
10	276	Banco Inbursa	Mexico	21.06
11	588	Capitec Bank Holdings	South Africa	20.90
12	723	First Security Bancorp	US	19.54
13	123	Samba Financial Group	Saudi Arabia	19.25
14	161	Saudi British Bank (SABB)	Saudi Arabia	19.11
15	578	Bandhan Bank	India	18.92
16	916	Export Import Bank of Thailand	Thailand	18.87
17	411	Bank Danamon Indonesia	Indonesia	18.84
18	719	Al Masraf	United Arab Emirates	18.63
19	783	International Bank of Azerbaijan (IBA)	Azerbaijan	18.61
20	720	New York Private Bank & Trust Corporation	US	18.54
21	501	Seven Bank	Japan	18.22
22	138	Bank Central Asia (BCA)	Indonesia	18.12
23	214	AlInma Bank	Saudi Arabia	18.03
24	477	Landsbankinn	Iceland	17.82
25	304	Alawwal Bank	Saudi Arabia	17.73

Top 25 by BIS Capital Ratio

Rank	World Rank	Bank Name	Country	BIS capital ratio %
1	345	Trade Bank of Iraq	Iraq	108.73
2	443	Nederlandse Waterschapsbank	Netherlands	74.00
3	969	First Energy Bank	Bahrain	65.00
4	590	United National Corporation	US	61.98
5	798	Banco Hipotecario del Uruguay (BHU)	Uruguay	58.55
6	393	Coventry Building Society	UK	45.60
7	594	Cagamas Berhad	Malaysia	45.00
8	102	Nationwide Building Society	UK	42.90
9	831	First Citizens Bank	Trinidad and Tobago	39.34
10	654	Leeds Building Society	UK	38.50
11	229	Bank Nederlandse Gemeenten	Netherlands	38.10
12	694	Daiwa Next Bank	Japan	37.94
13	783	International Bank of Azerbaijan (IBA)	Azerbaijan	37.80
14	885	African Bank	South Africa	37.80
15	307	SNS Bank	Netherlands	37.10
16	473	Beal Bank	US	36.86
17	680	National Bank of Umm Al Qaiwain	United Arab Emirates	36.73
18	934	Saxo Bank Group	Denmark	35.00
19	588	Capitec Bank Holdings	South Africa	33.90
20	754	Export Import Bank of the Republic of China	Taiwan	33.83
21	668	National Bank of Bahrain	Bahrain	33.81
22	512	Skipton Building Society	UK	33.80
23	364	Aareal Bank	Germany	31.94
24	255	J Safra Sarasin Holding	Switzerland	31.78
25	249	Bank Gospodarstwa Krajowego	Poland	31.50