The October issue of Global Finance magazine featured The World’s Top Ten Safest Banks for 2008.
The Banks were selected based on:
- A comparison of the long-term credit ratings (issued by S&P, Moody’s and Fitch’s)
- Total assets
of the 300 largest banks in the world.
The World’s Top Ten Safest Banks 2008:
[TABLE=117]
Of the above ten banks, Lloyds TSB (LYG) , BNP Paribas (BNPQY) and Wells Fargo (WFC) are listed in the USA.
In September Llyods Bank (LYG) of UK agreed to acquire U.K.’s biggest mortgage lender HBOS plc (HBOOY) for a fire-sale price of £12.2 billion ($21.8 billion) in an all stock deal.Llyods will offer 0.605 shares for every 1 HBOS share. Llyods raised a total of £5.5 billion from the British Government by selling ordinary shares for £4.5 billion and preference shares for £1 billion. The current yield on LYG is 12.76% but the dividend may be suspended till 2010 as part of the requirement of the government rescue package.
Last month Wells Fargo (WFC), the largest bank on the US West Coast, announced a deal to acquire Charlotte, North Carolina-based Wachovia (WA) for about $15.1 in stock. To fund this deal, Wells Fargo raised about $11B in a stock offering on November 7. It priced the sale at $27/share below the Nov 7 closing price of $29.50. The current yield of WFC is 3.99%.
The Paris, France-based BNP Paribas (BNPQY) trades on the OTC market and pays a dividend of 7.21%. Year-to-Date the stock is down about 35%. In 3Q 08, profit fell 56% for this French banking giant. BNP Paribas also announced that will take control of the troubled Dutch financial group Fortis’s Belgium and Luxembourg operations.
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