The Top 25 Banks in Latin America 2009

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Recently the highly influential AméricaEconomía magazine published a list of The Best 25 Banks in Latin America for 2009. This list differs from the earlier list that I posted back in June where I listed the top banks by country in Latin America.

The Top 25 Banks in Latin America

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Top-25-Latin-America-Banks

Source: AméricaEconomía

Note: Cl = Chile, BR = Brazil, EC= Ecuador, MX = Mexico, CO= Colombia, PE = Peru

During the credit crunch and the following recession many US banks have filed and the banking sector is still suffering from losses with no end in sight.Yesterday marked the 99th bank in the US. However banks in Latin America have prospered during the same period. For example, in September this year the market capitalization of banks in Peru rose by over 50% compared to a fall of 2.3% for US banks. For Brazil banks, the increase was about 24%. The average profitability of Latin American banks was 15.6% while most US banks are still in the red.

Basel Index:

This index measures the capital to risk-weighted assets of a bank. This index for Latin American banks is about 15% compared to 12% for banks in the US, Germany and the UK.

After acquiring Unibanco, Itau Unibanco (ITUB) Bank of Brazil jumped two positions from last year easily beating state-run Banco do Brasil and Bradesco(BBD). Itau has also become a strong global player in the banking industry. The Mexican and Brazilian banks were vulnerable during the worldwide economic crisis last year. However they came out of the crisis strong without having any liquidity or solvency problems. Banks in Peru, Colombia entered the crisis with a strong position and have since emerged even stronger due to prudent risk control measures and regulations.

Other banks that are included in the above include subsidiaries of Spanish banks Santander (STD) and BBVA (BBV) and Canadian bank Bank of Novo Scotia (BNS). Chilean Bank Banco Santander (SAN), BancColombia(CIB) of Colombia also made it to the list.

The World’s Top 10 Economies

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The US economy is the largest economy in the world. Last year it accounted for more than 1/4th of the world’s GDP. Following the US were Japan, Germany, China and UK. In the top 10 rankings noted below, just two developing economies are represented. China and Brazil are leading the emerging economies by taking a significant portion of the world’s GDP. However due to its population and growth, China’s share of world’s GDP is more than double that of that of Brazil.

Top-10-Economies-of-world-2008-2050

By 2050, China is projected to jump to number one overtaking the US. India is estimated to become the third largest economy. Replacing many of the developed countries will be other emerging markets like Mexico, Indonesia and Russia. Similar to Brazil, Indonesia has lots of potential to grow due to abundance of natural resources and a huge population, the majority of whom follow Islam.

In the early 1800s, China and India used to the world’s largest economies. Even colonial powers like the UK and France  were behind with accounting for just 5.4% and 5.2% of the world’s output at that time. The US was at number nine in the 1800s. From being a small economy in 1820, the US economy has grown at an astonishing rate to become the largest economy in the world now. Clearly the US economy has outperformed the former economic powers of UK, France, Spain, Japan in the developed world.

Knowledge is Power: China, Australia, Recession Edition

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As investors return to the market, big companies in Europe are finding it easier to raise money via bonds, equities and even IPOs. The Big Thaw

MSM Reporting as Propaganda (No One Minds Our New Financial Masters Edition)
I’m of two minds about taking up this theme, since stating what ought to be obvious but is nevertheless unpleasant and inconvenient is apt to get one branded as lunatic fringe.

Access journalism has created what is in many respects a controlled press. And that matters because people are far more suggestible than most of us wants to admit to ourselves.

Western makers of luxury products are enjoying a sales boom in China, as the number of rich Chinese continues to grow while the rest of the world struggles amid the continuing downturn.China’s rich throw lifeline to the West

Canada is leaving the dark days of the recession behind and is poised to move forward with moderately strong and steady growth over the next two years…Economy set for strong growth, board says

Cash is no longer king for asset allocators, but investors are mixed on which Asian countries they favour, according to Bank of America Merrill Lynch’s monthly fund manager poll. Investors more upbeat on China, but underweight Korea

Australia could become victim of its own fortune

Manufacturing surveys, considered reputable early signals on the economy, show emerging markets leading the way out of the downturn.By Some Reliable Measures, Recession Is Over

The 20 Most Valuable Brands in China

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Recently we reviewed the Top 100 Consumer Brands in China. Today lets look at The 20 Most Valuable Brands brands in China.

CLSA compiled this list “by reviewing both the brand strength and the market conditions of the industry. The number of Chinese companies with positive brand equity is increasing, particularly in the Banks, Consumer Electronics, Food and Beverage, Internet Services, Retail and Apparel sectors. A list of the top-20 companies is led again by China Mobile, and the major financial institutions.”

The 20 Most Valuable Brands brands in China

Most-valuable-brands-China

Source: CLSA Asia-Pacific Markets

Some of the above companies that trade in the US markets are:

1. China Mobile Ltd. (CHL)
2. Bank of China Ltd (OTC: BACHY)
3. China Life Insurance Co. Ltd. (LFC)
4. China Merchants Bank (OTC: CIHKF)
5. Changyou.com Limited (CYOU)
6. Alibaba.com (OTC: ALBCF)

Top 10 stocks in the DJ Canada Select Dividend Index

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The Dow Jones Select Dividend Index family of indices measures contain the top dividend paying stocks at the regional, country and global levels. One of the country-specific dividend index in this family is the DJ Canada Select Dividend Index. The main features of this index are:

  • Thirty stocks are selected to the index annually based on dividend yield, subject to screening and buffering criteria.
  • Components are weighted by indicated annual dividend.

In 2008, this index was down 30.80%. As of September 30th, the index has gained nearly 34%. The 5-year average annual total return is around 8%. The current dividend yield is 4.52%. The index is heavily concentrated with financials making up for nearly 72% of the portfolio.

The Top 10 holdings in the DJ Canada Select Dividend Index are:

1. National Bank of Canada
2. Bank of Montreal – BMO
3. Canadian Imperial Bank of Commerce – CM
4. Toronto-Dominion Bank – TD
5. Royal bank of Canada – RY
6. Bank of Novo Scotia – BNS
7. IGM Financial
8. Manitoba Telecom Services
9. TMX Group Inc
10.A.G.F. Management Ltd. Cl B NV

Related ETF: The iShares CDN Dividend Index Fund (XDV.TO) replicates the performance of Dow Jones Canada Select Dividend Index(SM). This ETF has an asset base of C$ 388M.