The Top 25 Highest Movers table is once again largely a story of Chinese growth. For the third year running, Chinese banks dominate the top 25 highest movers in the Top 1000 World Banks ranking – accounting for 16 of the banks.
Furthermore, China’s Haikou Rural Commercial Bank takes the number one spot as the highest moving bank in the world with a 626% increase in Tier 1 capital to $620m. China Resources Bank of Zhuhai ranks as the second highest mover with a 387% uplift in Tier 1 capital to $1.08bn.
Chinese banks’ aggregate Tier 1 capital grew by 27.6% from $612bn in last year’s ranking to $781bn in this year’s ranking. This growth was partly necessary to keep up to speed with the expansion in assets – aggregate assets grew by 24% from $10,800bn to $13,500bn over the same period.
By growing their capital in tandem with their assets, Chinese banks have seen their average capital to assets ratio (CAR) increase from 5.6% in the 2010 table to 5.77% in this year’s ranking. Perhaps most strikingly, Chinese banks have more than doubled their share of global Tier 1 capital in the rankings from 5.4% in 2007 to 12% this year.
While Chinese banks have posted their best performing year to date in the rankings, it is worth mentioning that last year’s highest mover, the US bank First Southern Bancorp, had recorded a higher Tier 1 capital increase of 754% to $368m, largely owing to its $400m private offering of common and preferred stock to institutional investors.
The US comprises the second largest country representation in the highest movers table with five banks this year compared with three in 2011. However, this is not so much a reflection of a wider regional trend but rather small regional banks that are recapitalising.
Connecticut-based Rockville Financial ranks as the fourth highest mover with a 222% increase in Tier 1 capital to $339m, while Hawaii’s Central Pacific Financial Corp comes in in sixth place with a 207% increase to $555m. The other US banks are Hancock Holding Co, BBCN Bancorp and First Niagara Financial Group in a respective 16th 18th and 23rd place.
In third position, Allied Irish Banks also stand out in this year’s highest movers table after having increased its Tier 1 capital by 244% to $19.49bn. This hike in capital is on the back of the Irish government’s acquisition of a 97% stake in the lender for $7.24bn in a deal which closed in July 2011. Its nationalisation saw the bank’s Tier 1 capital shoot up from 2.92% last year to 11% in this year’s ranking. It is also reflective of a broader recapitalisation trend across the Irish banking industry. The aggregate Tier 1 capital of Irish banks grew by 72% from $23.51bn in last year’s table to $40.52bn this year.
Bank Pasargad, the biggest private bank in Iran, also saw a notable Tier 1 capital rise of 148% to $3.06bn. In this bank’s case, it had increased its assets by 47% to $18bn so the large capital increase followed suit. The asset growth was driven by the 44% rise in credit facilities granted by the bank from $5.8bn in March 2010 to $8.4bn in March the following year while its deposits grew by 50%.
The other highest movers were Russia’s Credit Bank of Moscow in 15th position with a 97% increase in Tier 1 capital to $661m and Japan’s Tsukuba Bank in 24th position with an 80% rise to $1.04bn.
