The World’s Best Banks 2012 by Country

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The latest edition of Global Finance magazine has published The World’s Best Banks for 2012.From the cover story:

Some of the most successful global banks have cut back in Europe to focus on faster-growing emerging markets. Global Finance has identified the best banks in 136 countries and eight regions, as well as the best banks globally in 12 key banking categories. In selecting this year’s winners, Global Finance’s editorial team considered factors that range from the objective to the informed subjective. The objective criteria included growth in assets, profitability, geographic reach, strategic relationships, new business development and product innovation. Subjective criteria included the opinions of equity and credit-rating analysts, banking consultants and others in the industry, as well as corporate and financial executives.

The winners are not always the biggest banks, but rather the best banks—those with qualities that corporations should look for when choosing a bank. These are banks with the most-effective risk-management systems and excellent service.

The best banks by country as listed below:

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Source:World’s Best Banks 2012: Country Winners , Global Finance

Long-Term Investment in British Stocks Pays Off

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Holding an investment such as stocks, bonds or other assets usually yields higher returns over the long-term than short-term. The minimum long-term can defined as a duration of five years but depends depends on many factors including an individual investor’s situation. Stocks for the long-term must be high quality stocks that pay dividends, have consistent earnings and are well established firms in their fields. When such stocks are held for the long-term and dividends are re-invested returns are amplified due to the effect of compounding.

Here is a chart showing how long-term investment in British stocks performed very well:

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Source:

Celebrating the Diamond Jubilee: shares reign among the asset classes!, May 2012, M&G Investments

From the research report:

How has a £100 investment fared over 60 years?

If you had invested £100 in shares when Elizabeth became Queen in 1952, what journey would that £100 have been on during the 60 years? Well, over the period, according to the Barclays Equity Gilt Study (2012), £100 invested in UK shares would have returned £4,430 by the end of 2011, compared with £352 from government bonds and £249 from cash (taking into account the effects of inflation over this period, gross income reinvested). It is clear from these figures that shares provided the greatest protection from inflation, and at the same time, produced some real growth. At times during the period, inflation hit extreme highs, yet shares remained resilient compared to bonds.

The Diamond Jubilee of Queen Elizabeth II will be celebrated through out 2012 and the key events were held in June.

Related ETF:

iShares MSCI United Kingdom Index (EWU)

Disclosure: No Positions

For a list of UK stocks trading on the US markets click here.

Knowledge is Power: Inflation Fears, Greece, Carmageddon Edition

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The World’s Top 40 Steel-Producing Companies

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Earlier this month Nippon Steel Corp. and Sumitomo Metal Corp. of Japan merged to form the second biggest steelmaker in the world. The merged company had a combined production capacity of 46 million tons which is about half of production capacity of the number one global steelmaker ArcelorMittal (MT). Nippon Steel & Sumitomo Metal trades on the OTC market under the ticker NSSMY.

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Source: Steel’s New Number 2, The Wall Street Journal

The journal article noted that with this merger, nine out of the top ten steel makers are Asian companies.

Who were the World’s Top Steel-Producing Companies in 2011?

 

 

Source: World Steel Association

Some of the steel makers trading on the US markets include:

1. POSCO (PKX)
South Korea

2. ArcelorMittal(MT)
Luxemourg

3. Nucor Steel (NUE)
USA

4. Companhia Siderurgica Nacional SA (SID)
Brazil

5. Gerdau (GGB)
Brazil

6.Mechel OAO(MTL)
Russia

7.Tenaris (TS)
Luxembourg

8.Ternium (TX)
Argentina

Related:

A Review of the Current Global Steel Market  (June, 2009)

Download:

Worlds Top Steel Producers From 1970 To 2011 (pdf)

Disclosure: No Positions

Germany’s Sources of Electricity Generation

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Germany has set an ambitious plan to move away from fossil fuels and abandon nuclear power in the coming years. As a major industrial powerhouse this a big challenge since the country has to find other sources of electricity to replace the power generated from fossil fuels and nuclear power. Germany is increasingly depending renewable energy sources to meet its electricity needs, By the year 2020, one-third of power produced is projected to come from renewable sources.

Germany’s Sources of power generation in 2011:

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Source: The Energiewende – Germany’s gamble by David Buchan, June 2012, The Oxford Institute for Energy Studies, University of Oxford

Four companies dominate power generation in Germany. These firms include Germany-owned EnBW, E.ON(EONGY), RWE (RWEOY)and Swedish-owned Vattenfall which provides electricity generation in the former East German parts of the country. The three major German utilities noted above have seen their share prices plunge in the since last year due to the government’s decision to phase out nuclear power. However in the past few months their share prices have stabilized and have slowly started to crawl up. Up until now these three firms have been big players in the renewable energy market in other countries but not in their home country of Germany.

Vattenfall is one of Europe’s largest producers of electricity and heat. The group is 100% owned by the Swedish state. Vattenfall’s core markets are Sweden, Germany and the Netherlands  and has operations in Belgium, Denmark, Finland, Poland, France and the UK as well. The company’s share does not trade on the US markets.

The long-term performance of E.ON (EONGY) and RWE AG(RWEOY) is show below:

 

Source: Yahoo Finance

Related ETF:

iShares MSCI Germany Index Fund(EWG)

Related article:

German Energy Plan Plagued by Lack of Progress (Der Spiegel)

Clean Break: Germany’s Switch to Renewables (Bloomberg)

Disclosure: Long EONGY and RWEOY