World’s Safest Banks 2024: Commercial Top 50

For the commercial banking sector, continuous innovation, strong product development and customer service, and effective risk management are just some of the critical elements necessary to sustain and grow a franchise. The banks included among our 50 Safest Commercial Banks continue to demonstrate leadership in their respective markets to earn a spot in this year’s rankings.

The interest rate cycle has shifted in many jurisdictions, as central bank policy has now adopted an easing stance following a period of elevated interest rates necessary to battle inflation. During this time, much of the sector enjoyed healthy profitability bolstered by expanding net interest margins. However, as central banks continue to cut rates to maintain economic growth, it remains to be seen how long banks can sustain these margins as successive rate cuts take hold.

To maintain growth and profitability, these institutions must continue to embrace innovation to boost revenue and increase the efficiency of bank operations. In recent years, the sector has focused on honing its digital offerings with online and mobile banking platforms to provide customizable solutions and powerful apps with user-friendly interfaces and dashboards, to better attract and serve clients. While this involves leveraging vast amounts of bank data to identify and target new customers and products, many banks are accelerating this process by utilizing generative AI technology to unlock valuable insights from this data more rapidly, for the development of new services, automation of internal processes and workflows, and elevation of the bank’s risk management capabilities to better manage inherent risks related to cybersecurity, fraud protection, and compliance issues.

In addition to solid operating performance by many banks, regulatory requirements are also contributing to enhanced capital positions. This has resulted in ratings upgrades and consequent movements in our rankings. Australian banks made the biggest of those moves, as Commonwealth Bank of Australia, ANZ Group, National Australia Bank, and Westpac each rose 10 spots year-over-year and now place among our top 10. This follows upgrades by Moody’s and Fitch during the first half of 2024 that reflect the implementation of a formal resolution-planning framework that also involved an increase in loss-absorbing capital buffers at these banks. This development is designed to ensure stability in the Australian financial system, as these banks collectively represent over 70% of banking system assets.

In many instances, upgrades to a country’s sovereign ratings have a follow-on impact on the ratings of their banks, given the increased ability of the government to support the banking sector. In March, Fitch upgraded the sovereign rating of Qatar to AA, subsequently boosting the ratings of seven Qatari banks including Qatar National Bank, which moved up 11 places to No. 31.

Additional moves as a result of positive rating action include UBS, which rose eight spots in our ranking to No. 21 as a result of a Moody’s upgrade to Aa2 in May 2024. This upgrade reflected the Credit Suisse acquisition, which added additional long-term debt providing loss-absorbing benefits. The bank has stabilized the Credit Suisse franchise following its acquisition in 2023.

With its leading position as the largest bank in Denmark, Danske Bank jumped into the rankings at No. 39 following Moody’s two-notch upgrade of the bank’s long-term debt rating to A1 from A3 in May. This reflected an improvement in governance controls following deficiencies in the bank’s Estonia operations. Fitch cited this operational remediation as well as improved profitability and capitalization as a basis for its upgrade to A+ from A in Sept. 2023. NongHyup Bank benefited from a Moody’s upgrade in November 2023 to Aa3 from A1, and is a new entrant at No. 45.

Under the methodology for the World’s Safest Banks rankings, commercial banks that are majority state owned or receive sponsorship by their governments or regional bodies are excluded. Institutions here may operate in the same markets as state-sponsored competitors but don’t benefit from government backing. Additionally, institutions that are wholly owned by their parent company are ineligible under our criteria.