Safest Emerging Markets Banks 2013 - Global Finance Magazine

ANNUAL REPORT: SAFETY COMES FIRST

Global Finance presents its annual ranking of the Top 50 Safest Banks in the Emerging Markets.

National Bank of Abu Dhabi (NBAD) is the safest emerging markets bank, following its October upgrade by Standard and Poor’s. The bank now holds AA- ratings from all three major ratings agencies. It’s the only emerging markets bank to do so.

Eight banks follow NBAD in the rankings, with two AA- ratings and an A+. Banks in Asia and the GCC account for 44 of the safest 50 banks in emerging markets, further strengthening those regions’ positions in comparison to recent years. In 2012, Asian and GCC banks accounted for 43 of the top 50 banks, and in 2011 they accounted for 39.

Three countries contribute the 22 Asian banks in the top 50: South Korea, with 10; China, with eight; and Taiwan with four. In contrast, five of the six GCC states contribute to the 22 GCC banks in the top 50—Bahrain is the exception. Saudi Arabia contributes nine banks to the top 50, the same as last year. They account for three-quarters of all locally incorporated Saudi banks, and an even bigger proportion of Saudi banking assets.

Outside Asia and the GCC, only two countries contribute banks to the top 50: Chile, with four, and the Czech Republic, with two. New entrants to this year’s rankings include HSBC Bank Oman (ranked 48), the result of a merger earlier this year between HSBC’s branch in Muscat and the locally owned Oman International Bank; and China’s Bank of Communications (ranked 49), which was upgraded by Fitch.

This year’s rankings also include the Export-Import Bank of China and the Export-Import Bank of Korea, both of whose ratings place them near the top of the rankings. As was the case last year, two A- ratings and one A was the standard needed to claim a place in the top 50 global rankings.

The regional lists continue to be dominated by banks in a handful of countries. Chilean and Mexican banks hold all but two of the top 10 positions in Latin America. In Central and Eastern Europe and the former Soviet Union, Czech and Polish banks dominate, although Russia’s Vnesheconombank retains its position in the top 10, at number seven, and Sberbank, at nine.

Outside the global and regional rankings, over the past year, both Fitch and Moody’s have upgraded the Turkish Republic and many of its banks to investment grade. Malaysian banks hold higher ratings than many of the banks listed in the regional rankings, but they fail to score highly enough to be included in the Asian regional list.

Outside South Africa, rating coverage of banks in sub-Saharan Africa remains small, and only South African institutions hold investment-grade ratings.

HOW WE MEASURE THE SAFETY OF BANKS

Fitch/S&P	Moody’s
AAA	Aaa
AA+	Aa1
AA	Aa2
AA-	Aa3
A+	A1
A	A2
A-	A3
BBB+	Baa1

The safest banks chart compares the ratings for the world’s largest 500 banks, based on asset size. Long-term foreign currency ratings issued by Fitch Ratings, Standard & Poor’s and Moody’s Investors Service were used. Where possible, ratings on holding companies were used rather than operating companies, and banks that are wholly owned by other banks were omitted. Within each rank set, banks are rated according to asset size, based on data for the most recent annual reporting period provided by Fitch Solutions and Moody’s. In previous years we assigned a “tie” score to banks that had the same number of points and had assets within $5 billion of each other. We have changed our methodology on this point and will no longer be giving “ties.” Ratings are reproduced with permission from the three ratings agencies, with all rights reserved. A rating is not a recommendation to purchase, sell or hold a security, and it does not comment on market price or suitability for a particular investor.

Rank	Bank Name	Fitch rating	Moody’s rating	S&P rating	Total Points	Reporting Assets ($million)	Country
1	National Bank Of Abu Dhabi	AA-	Aa3	AA-	21	81,851	UAE
2	China Development Bank	A+	Aa3	AA-	20	1,195,563	China
3	Agricultural Development Bank of China	A+	Aa3	AA-	20	364,584	China
4	Export-Import Bank of China	A+	Aa3	AA-	20	247,859	China
5	Industrial Bank of Korea	AA-	Aa3	A+	20	184,693	South Korea
6	Korea Finance Corporation	AA-	Aa3	A+	20	**288,203	South Korea
7	National Bank of Kuwait	AA-	Aa3	A+	20	58,409	Kuwait
8	Export-Import Bank of Korea	AA-	Aa3	A+	20	50,985	South Korea
9	BancoEstado	A+	Aa3	AA-	20	48,367	Chile
10	Korea Development Bank	AA-	Aa3	A	19	154,600	South Korea
11	Qatar National Bank	A+	Aa3	A+	19	100,784	Qatar
12	Samba Financial Group	A+	Aa3	A+	19	53,126	Saudi Arabia
13	Bank of Taiwan	N/R	Aa3	A+	18.5	139,628	Taiwan
14	Banco de Chile	N/R	Aa3	A+	18.5	48,592	Chile
15	National Commercial Bank	A+	A1	A+	18	92,085	Saudi Arabia
16	Al Rajhi Bank	A+	A1	A+	18	71,302	Saudi Arabia
17	Banco Santander Chile	A+	Aa3	A	18	51,727	Chile
18	Riyad Bank	A+	A1	A+	18	50,715	Saudi Arabia
19	Abu Dhabi Commercial Bank	A+	A1	A	17	49,230	UAE
20	Banque Saudi Fransi	A	Aa3	A	17	42,074	Saudi Arabia
21	SABB	A	Aa3	A	17	41,774	Saudi Arabia
22	Union National Bank	A+	A1	N/R	17	23,727	UAE
23	Industrial and Commercial Bank of China	A	A1	A	16	2,789,090	China
24	China Construction Bank	A	A1	A	16	2,221,582	China
25	Agricultural Bank of China	A	A1	A	16	2,105,758	China
26	Bank of China	A	A1	A	16	2,016,129	China
27	KB Kookmin Bank	A	A1	A	16	240,737	South Korea
28	Shinhan Bank	A	A1	A	16	218,652	South Korea
29	NongHyup Bank	A	A1	A	16	182,065	South Korea
30	Kuwait Finance House	A+	A1	A-	16	52,288	Kuwait
31	Arab National Bank	A	A1	A	16	36,437	Saudi Arabia
32	Hana Bank	N/R	A1	A	15.5	**161,109	South Korea
33	Land Bank of Taiwan	N/R	Aa3	A-	15.5	*82,040	Taiwan
34	First Gulf Bank	A+	A2	N/R	15.5	47,661	UAE
35	Abu Dhabi Islamic Bank	A+	A2	N/R	15.5	23,326	UAE
36	Mega International Commercial Bank	A-	A1	A	15	83,631	Taiwan
37	Chinatrust Commercial Bank	A	A2	A	15	**72,416	Taiwan
38	Česká spořitelna	A	A2	A	15	48,303	Czech Republic
39	Banco de Crédito e Inversiones	A-	A1	A	15	37,593	Chile
40	Commercial Bank of Qatar	A	A1	A-	15	21,988	Qatar
41	Woori Bank	A-	A1	A-	14	230,930	South Korea
42	Korea Exchange Bank	A-	A1	A-	14	97,137	South Korea
43	Komerční banka	A-	A2	A	14	41,293	Czech Republic
44	Bank Muscat	A-	A1	A-	14	20,582	Oman
45	Saudi Hollandi Bank	A-	A1	N/R	14	18,268	Saudi Arabia
46	Doha Bank	A	A2	A-	14	15,168	Qatar
47	Commercial Bank of Kuwait	A+	A3	N/R	14	*13,044	Kuwait
48	HSBC Bank Oman	A+	A3	N/R	14	6,266	Oman
49	Bank of Communications	A	A3	A-	13	838,430	China
50	Saudi Investment Bank	A-	A2	A-	13	15,751	Saudi Arabia

Rank	Bank Name	Fitch rating	Moody’s rating	S&P rating	Total Points	Reporting Assets ($mn)	Country
1	Česká spořitelna	A	A2	A	15	48,303	Czech Republic
2	Komerční banka	A-	A2	A	14	41,293	Czech Republic
3	PKO Bank Polski	N/R	A2	A-	12.5	62,421	Poland
4	Bank Pekao	A-	A2	BBB+	12	48,700	Poland
5	ING Bank Śląski	A	Baa1	N/R	11	25,251	Poland
6	BRE Bank	A	Baa3	BBB+	9	32,984	Poland
7	Vnesheconombank	BBB	Baa1	BBB	7	96,108	Russia
8	Bank Handlowy w Warszawie	A-	Baa3	BBB	7	*14,058	Poland
9	Sberbank	BBB	Baa1	N/R	6.5	497,067	Russia
10	Bank Zachodni WBK	BBB	Baa1	N/R	6.5	19,364	Poland
11	VTB Bank	BBB	Baa2	BBB	6	244,155	Russia

Rank	Bank Name	Fitch rating	Moody’s rating	S&P rating	Total Points	Reporting Assets ($mn)	Country
1	BancoEstado	A+	Aa3	AA-	20	48,367	Chile
2	Banco de Chile	N/R	Aa3	A+	18.5	48,592	Chile
3	Banco Santander Chile	A+	Aa3	A	18	51,727	Chile
4	Banco de Crédito e Inversiones	A-	A1	A	15	37,593	Chile
5	HSBC Mexico	A	Baa1	BBB	10	37,314	Mexico
6	Banco Santander Mexico	BBB+	Baa1	BBB	8	57,506	Mexico
7	Banco de Crédito del Perú	BBB+	Baa2	BBB+	8	35,450	Peru
8	Banco Nacional de Obras y Servicios Publicos	BBB+	Baa1	BBB	8	27,229	Mexico
9	BBVA Chile	N/R	Baa1	BBB+	8	19,575	Chile
10	BBVA Continental	BBB+	N/R	BBB+	8	19,486	Peru
11	Banco Nacional de Comercio Exterior	BBB+	Baa1	BBB	8	16,589	Mexico
12	Scotiabank Perú	BBB+	Baa2	BBB+	8	*12,366	Peru
13	First Citizens Bank	N/R	Baa1	BBB+	8	5,299	Trinidad & Tobago

Rank	Bank Name	Fitch rating	Moody’s rating	S&P rating	Total Points	Reporting Assets ($mn)	Country
1	China Development Bank	A+	Aa3	AA-	20	1,195,563	China
2	Agricultural Development Bank of China	A+	Aa3	AA-	20	364,584	China
3	Export-Import Bank of China	A+	Aa3	AA-	20	247,859	China
4	Industrial Bank of Korea	AA-	Aa3	A+	20	184,693	South Korea
5	Korea Finance Corporation	AA-	Aa3	A+	20	**288,203	South Korea
6	Export-Import Bank of Korea	AA-	Aa3	A+	20	50,985	South Korea
7	Korea Development Bank	AA-	Aa3	A	19	154,600	South Korea
8	Bank of Taiwan	N/R	Aa3	A+	18.5	139,628	Taiwan
9	Industrial and Commercial Bank of China	A	A1	A	16	2,789,090	China
10	China Construction Bank	A	A1	A	16	2,221,582	China
11	Agricultural Bank of China	A	A1	A	16	2,105,758	China
12	Bank of China	A	A1	A	16	2,016,129	China
13	KB Kookmin Bank	A	A1	A	16	240,737	South Korea
14	Shinhan Bank	A	A1	A	16	218,652	South Korea
15	NongHyup Bank	A	A1	A	16	182,065	South Korea

Rank	Bank Name	Fitch rating	Moody’s rating	S&P rating	Total Points	Reporting Assets ($mn)	Country
1	National Bank of Abu Dhabi	AA-	Aa3	AA-	21	81,851	UAE
2	National Bank of Kuwait	AA-	Aa3	A+	20	58,409	Kuwait
3	Qatar National Bank	A+	Aa3	A+	19	100,784	Qatar
4	Samba Financial Group	A+	Aa3	A+	19	53,126	Saudi Arabia
5	National Commercial Bank	A+	A1	A+	18	92,085	Saudi Arabia
6	Al Rajhi Bank	A+	A1	A+	18	71,302	Saudi Arabia
7	Riyad Bank	A+	A1	A+	18	50,715	Saudi Arabia
8	Abu Dhabi Commercial Bank	A+	A1	A	17	49,230	UAE
9	Banque Saudi Fransi	A	Aa3	A	17	42,074	Saudi Arabia
10	SABB	A	Aa3	A	17	41,774	Saudi Arabia
11	Union National Bank	A+	A1	N/R	17	23,727	UAE
12	Kuwait Finance House	A+	A1	A-	16	52,288	Kuwait
13	Arab National Bank	A	A1	A	16	36,437	Saudi Arabia
14	First Gulf Bank	A+	A2	N/R	15.5	47,661	UAE
15	Abu Dhabi Islamic Bank	A+	A2	N/R	15.5	23,326	UAE
16	Commercial Bank of Qatar	A	A1	A-	15	21,988	Qatar

Rank	Bank Name	Fitch rating	Moody’s rating	S&P rating	Total Points	Reporting Assets ($mn)	Country
1	Absa Bank	A-	Baa1	BBB	9	89,927	South Africa
2	FirstRand Bank	BBB	Baa1	BBB	7	84,156	South Africa
3	Standard Bank of South Africa	BBB	Baa1	BBB	7	115,161	South Africa
4	Nedbank	BBB	Baa1	BBB	7	80,339	South Africa
5	Investec Bank	BBB-	Baa1	N/R	5	33,356	South Africa

N/R – No Rating
Ratings as of 25 October 2013
Source for ratings: Fitch Ratings, Standard & Poor’s, Moody’s Investors Service
Source for reporting assets: Fitch Solutions, except *Moody’s Investors Service, **Bank’s financial statements