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Top 1000 World Banks - Good news for western Europe as capital rebounds across board

Western European institutions have seen a distinct improvement on their poor 2017 figures, with most top banks increasing their capitalisation. HSBC remains local leader but has ceded a place on the global ranking. Stefanie Linhardt reports.
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After a gloomy picture for western Europe in 2017’s Top 1000 ranking, Tier 1 capital among the top 25 institutions in the region rose by $187.912bn, or 14.8%, in the 2018 ranking to $1454.46bn, as every lender increased its capitalisation on the previous year.

Across all 218 western European banks listed in the Top 1000 ranking, Tier 1 capital grew by an average of 16.46%, as only Cypriot banks decreased their capitalisation on aggregate.

The biggest winner of this year’s regional ranking is UniCredit, following a bad performance in the 2017 ranking. The Italian lender boosted its capitalisation by $29.1bn to $65.9bn, enabling it to improve on its 19th place to become western Europe’s eighth largest bank. Still, it needs to climb another three places to reclaim its 2016 regional position.

The UK’s HSBC remains the clear leader in Europe by capitalisation, which it increased by $12.9bn to $151bn, but it has dropped one place in the global ranking. Of the two largest French banks, BNP Paribas has pushed past Crédit Agricole into second after three years of ranking third in the region (having increased capitalisation by 17.61%). Compatriot Crédit Mutuel has risen two spots in the regional ranking, as has Italy’s Intesa Sanpaolo, while Germany’s DZ Bank and Dutch ABN Amro have both improved by one position.

Spain’s CaixaBank is the only new entrant in the top 25 this year, with a 22.73% increase in Tier 1 capital pushing it ahead of last year’s 23rd placed DNB Group of Norway, whose capitalisation also improved, but only to $22.76bn.

Through Banco BPM and Monte dei Paschi di Siena (MPS), another two Italian banks are among the highest movers by capitalisation in this year’s Top 1000 (along with UniCredit), after the formation of BPM by the merger of Banco Popolare and Popolare di Milano, and MPS being bailed out through a precautionary recapitalisation.

The highest movers table also boasts four UK banks, three of which underline the UK’s challenger bank trend: Shawbrook, OneSavings Bank – the fifth most profitable in the region by return on capital – and Metro Bank. These have grown on the back of a private equity buyout, retained earnings and a £278m ($368m) equity raise, respectively.

This year’s ranking stands in stark contrast to 2017's, when Tier 1 capital fell at 15 out of the top 25 banks in the region.

Top 25 Western Europe ($M)

Regional  Rank World Rank Bank Country Tier 1 capital
1 10 HSBC Holdings UK 150,954
2 12 BNP Paribas France 101,707
3 13 Credit Agricole France 101,557
4 15 Banco Santander Spain 93,112
5 18 Barclays UK 72,857
6 19 Groupe BPCE France 71,675
7 22 Deutsche Bank Germany 69,435
8 24 UniCredit Italy 65,907
9 29 Societe Generale France 59,655
10 32 BBVA Spain 56,602
11 33 Credit Mutuel France 54,913
12 34 ING Netherlands 54,478
13 35 RBS UK 53,451
14 36 Credit Suisse Group Switzerland 52,533
15 37 Intesa Sanpaolo Italy 52,367
16 38 Lloyds Banking Group UK 49,093
17 41 Standard Chartered UK 44,861
18 42 Rabobank Group Netherlands 44,824
19 43 UBS Switzerland 44,324
20 54 Nordea Group Sweden 33,745
21 58 Commerzbank Germany 31,307
22 68 Danske Bank Denmark 24,340
23 70 DZ Bank Germany 24,146
24 72 ABN Amro Group Netherlands 23,636
25 74 CaixaBank Spain 22,981

Highest Movers: Western Europe

Regional  Rank World Rank Bank  Country Tier 1 Capital % ch Tier 1 Capital $m
1 154 Caixa Geral de Depositos Portugal 132.32 9,435
2 129 Banco BPM Italy 114.83 11,576
3 135 Banca Monte dei Paschi di Siena Italy 91.38 10,785
4 534 The Co-operative Bank UK 86.52 1,697
5 118 Volkswagen Bank Germany 83.81 12,329
6 24 UniCredit Italy 78.87 65,907
7 837 Shawbrook Bank UK 64.63 753
8 456 Home Credit Netherlands 60.95 2,149
9 861 OneSavings Bank UK 55.72 703
10 658 Metro Bank UK 50.71 1,212

Top Five ROC: Western Europe

Regional  Rank World Rank Bank  Country Return on capital (%)
1 937 Banca Generali Italy 50.2
2 397 BancoPosta Italy 37.4
3 345 Schroders UK 33.38
4 473 Banca March Spain 32.83
5 861 OneSavings Bank UK 32.24

New Entrants: Western Europe ($M)

World Rank Bank Name Country Tier 1 Capital
397 BancoPosta Italy 2,481
696 Banca IFIS Italy 1,082
810 Banca Agricola di Ragusa Italy 826
985 Saxo Bank Group Denmark 490

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