All Six Domestic Financial Companies Drop or Stall in Rankings Among The Banker’s Top 100 Global Banks
[Asia Economy Reporter Yoo Je-hoon] Major domestic financial companies, which have been continuously breaking records for their best-ever performance, have been found to have declined in the global bank rankings.
According to the KDB Future Strategy Institute on the 27th, in the recent survey of the world's top 1000 banks based on last year, published by the UK magazine The Banker, the rankings of six domestic financial companies (KB, Shinhan, Hana, Woori Financial Group, Korea Development Bank, and Industrial Bank of Korea) within the top 100 all fell or stagnated. The Banker, published since 1926 by the Financial Times (FT), a leading British economic media outlet, releases the annual ranking of the world's top 1000 banks every July based on core capital (common stock, capital surplus, retained earnings, etc.).
KB Financial led among domestic financial companies but dropped two places from the previous year to 62nd in the world ranking. Shinhan Financial (64th, down 3), Hana Financial (73rd, down 2), Industrial Bank of Korea (94th, down 6), and Woori Financial (96th, down 5) each fell between 2 to 6 places. Korea Development Bank maintained its position at 63rd, the same as the previous year.
The decline in rankings of major domestic financial companies is due to growth and profitability factors. The core capital and asset growth rates of the six domestic financial companies were 2.8% and 0.1%, respectively, significantly below the growth rates of the top 1000 banks worldwide (4.7% and 3.8%). Return on total assets ranged from 0.40% to 0.71%, falling short of the average of the top 1000 banks (0.75%). The institute stated, "For domestic banks, rankings slightly declined compared to the previous year, and growth and profitability were somewhat weaker compared to the top 1000 banks."
Meanwhile, the world's top 10 banks were listed as Industrial and Commercial Bank of China (ICBC), China Construction Bank, Agricultural Bank of China, Bank of China, JP Morgan Chase, Bank of America (BOA), Citigroup, Wells Fargo, HSBC Holdings, and Bank of Communications. By country, China had five banks, the United States four, and the United Kingdom one. Bank of Communications (China) entered the top 10, replacing Mitsubishi UFJ (Japan), and except for Wells Fargo and HSBC swapping ranks, there were no major changes.
Looking at the top 1000 banks by region, Asia-Pacific had the most banks with 386, followed by Europe with 242, North America with 201, the Middle East with 68, and Africa with 38. South Korea had a total of 13 financial companies ranked within the top 1000, including the six companies in the top 100.
Senior Research Fellow Yoon Kyung-soo said, "Last year, the global banking industry saw little change in regional shares and the top 10 bank rankings. Asset and capital growth continued after the COVID-19 pandemic, and profitability improved compared to the previous year," but added, "Due to the prolonged Ukraine crisis and inflation, the global economic recovery is expected to slow this year, which will likely constrain growth in the global banking industry."
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