[Financial Essay] Which Countries Have the World's Top 1 to 4 Banks?

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Min-young] It has been revealed that China holds the top four positions in the global bank rankings. Among domestic banks, NH Nonghyup Financial Group entered the top 100 for the first time.

According to data from the KDB Industrial Bank Future Strategy Research Institute on the 26th, The Banker recently announced the rankings of the world's top 1,000 banks as of the end of last year.

Among the top 10 banks, the 1st place was taken by Industrial and Commercial Bank of China (ICBC), and the 2nd to 4th places were also Chinese banks: China Construction Bank (CCB), Bank of China, and Agricultural Bank of China.

From 5th to 8th place were all American banks: JPMorgan, Bank of America (BoA), Wells Fargo, and Citigroup, respectively. The 9th place was Mitsubishi UFJ Financial Group from Japan. The 10th place was occupied by the UK’s HSBC Holdings.

In the case of domestic banks, with Nonghyup Financial newly entering the top 100 banks, seven banks were positioned in the ranking. KB Financial Group was the highest among domestic banks at 61st place but dropped two places compared to the previous year. Shinhan Financial Group and KDB Industrial Bank ranked 65th (down 2 places) and 67th (down 3 places), respectively.

Hana Financial Group ranked 81st (down 4 places), IBK Industrial Bank 96th (down 1 place), Woori Financial Group 91st (maintained), and Nonghyup Financial Group 100th (up 1 place).

The regional distribution of the world’s top 1,000 banks is as follows: Asia-Oceania 376, Europe 264, North America 198, Middle East 68, Latin America 58, and Africa 36.

As of the end of last year, the core capital of the world’s top 1,000 banks was $8.8 trillion, an increase of 6.1% compared to the previous year. Total assets recorded $128.1 trillion (a 4.3% increase from the previous year). Pre-tax net profit was $1.2 trillion, showing a steady increase since 2016.

The research institute diagnosed that due to the economic crisis caused by the novel coronavirus disease (COVID-19), concerns over an increase in non-performing assets, and the continuation of a low-interest-rate trend, the deterioration of the banking management environment continues, increasing the importance of managing soundness and profitability. According to the Bank for International Settlements (BIS), due to credit deterioration caused by COVID-19, loan loss provisions surged mainly in US and EU banks during the first quarter of this year, and if COVID-19 persists, it is expected to have a negative impact on soundness and profitability.

The research institute advised, “To overcome the economic crisis, it is essential for banks to enhance their loss absorption capacity through capital expansion to provide stable and continuous funding, and it is necessary to seek new revenue bases in response to environmental changes caused by COVID-19.”

This content was produced with the assistance of AI translation services.