The World’s Safest Banks 2016

The Global Finance magazine published their 25th annual ranking of the World’s 50 Safest Banks earlier this month. The full list of the banks will be published in the November issue.

From the press release:

“The Safest Banks ranking for 2016 illustrates the impact of some the past year’s major political and economic shifts, with low oil prices in particular having significant impact on Gulf economies. With Brexit-like populism on the rise in many countries, political tensions threaten to derail reforms. Our ranking provides a consistent metric by which clients can compare the stability and security of banks across countries and regions,” says Global Finance publisher and editorial director Joseph D. Giarraputo.

Global Finance’s annual ranking of World’s 50 Safest Banks has been the recognized and trusted standard of financial counterparty safety for a quarter-century. Winners were selected through an evaluation of long-term foreign currency ratings—from Moody’s, Standard & Poor’s and Fitch—and total assets of the 500 largest banks worldwide.

The World’s Safest Banks 2016 are shown below:

RankBank NameCountry
2Zürcher KantonalbankSwitzerland
3Landwirtschaftliche RentenbankGermany
5Bank Nederlandse Gemeenten (BNG)Netherlands
6Nederalndse WaterschapsbankNetherlands
8Banque et Caisse d'Epargne de l'EtatLuxembourg
9Caisse des Dépôts et ConsignationsFrance
10Toronto-Dominion BankCanada
11DZ BankGermany
12DBS BankSingapore
13Svenska HandelsbankenSweden
14OCBC BankSingapore
15Korea Development BankSouth Korea
16United Overseas BankSingapore
17Export-Import Bank of Korea*South Korea
18Banque Cantonale VaudoiseSwitzerland
19Deutsche Apotheker- und ÄrztebankGermany
20Royal Bank of CanadaCanada
21Commonwealth Bank of AustraliaAustralia
22National Australia BankAustralia
23ANZ GroupAustralia
25Industrial Bank of KoreaSouth Korea
26Société de Financement Local (SFIL)France
27Pictet & CieSwitzerland
31Hang Seng BankHong Kong
32National Bank of Abu DhabiUAE
33AgriBankUnited States
34Caisse centrale DesjardinsCanada
35KiwibankNew Zealand
36China Development BankChina
37Sparkassen-Finanzgruppe (Sparkasse)Germany
39Agricultural Development Bank of ChinaChina
40Bank of MontrealCanada
41U.S. Bancorp**United States
42Export-Import Bank of ChinaChina
46HSBC FranceFrance
47Qatar National BankQatar
48CoBankUnited States
49National Bank of KuwaitKuwait
50OP Corporate Bank (formerly Pohjola)Finland

* Greatest gain over position on the 2015 list
**  New entry to the ranking

Source: Global Finance

Download: The World’s Safest Banks 2016 (in Excel)

A few observations:

  • Despite Brexit and other issues, European banks dominate the top 10 list.
  • While Deutsche Bank(DB) is bogged down in controversy Germany-based KfW has taken the top spot for fifth year in a row.
  • TD Bank (TD), one of the big five Canadian banks, came in at tenth rank.
  • Three banks from Singapore – DBS Bank(DBSDY), OCBC and United Overseas Bank(UOVEY) appear in this list.
  • Four major Aussie banks making it to this ranking is not surprising. Similarly a few other major Canadian banks also made the cut.
  • Among the US banks, US Bancorp(USB) took the 41st spot.

I have written about other banks in this list such as Svenska Handelsbanken and Nordea(NRBAY) before. From an investment perspective, these safest banks are some good options for investors to consider in the global banking industry.

Disclosure: Long USB, TD

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