Top 1000 World Banks - Russian wobbles stall CEE growth

A somewhat less favourable performance by Russian banks has dented the regional ranking of central and eastern European lenders in 2019. For the most part, the largest Russian institutions have registered contractions to their Tier 1 capital despite some notable exceptions among mid-sized to smaller banks.

This partially contributed to the decrease in aggregate Tier 1 Capital for the region’s 25 biggest lenders. In the 2019 ranking this figure reached $141.4bn, down from the $145.8bn recorded in the 2018 ranking. Sberbank, the region’s largest lender, has seen its Tier 1 capital decrease to $54.2bn in the 2019 ranking, down from $58.3bn the previous year. Similarly, VTB Bank, which comes in at number two in the regional table, has seen its Tier 1 capital drop to $19.5bn, from $23bn.

Even so, a number of Russian lenders have bucked the trend by securing gains to their Tier 1 capital positions. This includes the Russian Agricultural Bank which climbs to seventh position on the regional table, up from ninth in the 2018 ranking, with $4.9bn in Tier 1 capital. Similarly, Russia’s Otkritie Financial Corporation Bank moves to 10th place in the regional table, up from 16th, while Sovcombank also jumps a position to reach 14th place. All three lenders feature in the highest movers table.

The mixed performance of Russian lenders, coupled with gains made by some of their regional peers, ensure that the top 25 regional banks table has experienced considerable movement. Among the top five banks, Poland’s PKO Bank Polski has climbed into third position, leapfrogging Russia’s Gazprombank. Meanwhile, International Bank of Azerbaijan has broken into the top 25 banks table with Tier 1 capital of $906m.

As a result of these changes, the highest movers table in 2019 is a more diverse affair than the 2018 ranking, with banks representing six different jurisdictions compared with four in the previous ranking. Meanwhile, the top five return on capital table features two Georgian lenders and one each from Russia, Ukraine and Hungary. Russia’s Tinkoff Bank tops this table with a 46.4% return on capital, while Ukraine’s PrivatBank comes in a close second with 41.4%.

Top 25: Central & Eastern Europe ($M)

Highest Movers: Central & Eastern Europe

Top Five ROC: Central & Eastern Europe

New Entrants: Central & Eastern Europe