Winner’s Profile | Best Banks 2016

San Francisco-based Wells Fargo has used its strong balance sheet and correspondent banking relationships to serve clients around the world without investing heavily in local operations in distant lands. Although most of its assets remain in the US, the bank now has more than 50 global offices, including branches in the Dubai International Financial Centre as well as Beijing, Hong Kong, London, Seoul, Shanghai, Singapore, Taipei, Tokyo and Toronto.

Wells Fargo, long a leader in international trade finance, is the largest import factor worldwide, and the only bank to own a factoring company specializing in trade financing. Its supply-chain finance unit serves large corporations and their trading partners around the globe. Wells Fargo is one of the world’s largest providers of foreign exchange, treasury management, and trade-processing services.

The bank’s conservative risk-management policies and diversified business model have enabled it to earn record profits in the current low-interest-rate environment. The bank’s revenue is balanced between net interest income and fee-based income. In the US, Wells Fargo is the leading bank in small business lending, home mortgage customers, agricultural lending, and commercial real estate financing.

John Stumpf, chairman and CEO

www.wellsfargo.com

Butterfield Bank was established in Bermuda in 1858 and is listed on the Bermuda Stock Exchange. It has relied on its strong balance sheet and loyal customer base to build solid core businesses. In 2015 the bank improved its asset quality, increased is non-interest income and enhanced operating efficiency. It began realizing the benefits of its 2014 acquisition of Legis Group’s trust and corporate services business in Guernsey. It took a charge last year from winding down its private banking business in the UK.

Michael Collins, CEO

www.butterfieldgroup.com

Royal Bank of Canada had record earnings last year of $10 billion, despite the weak economy and trouble brewing in the oil sands. RBC continued to invest in its digital channels and in automating processes to boost efficiency. Canada’s largest bank by market capitalization, RBC has operations in 39 countries, including an extensive network in the English-speaking Caribbean. In November 2015, it closed on its acquisition of City National, boosting its US presence. RBC is Canada’s largest fund company and a top-five global wealth manager by assets. The bank is a leading provider of global custody services and one of the fastest-growing insurance organizations in Canada.

David McKay, president and CEO

www.rbc.com

With more than 8,700 locations in 38 states, Wells Fargo has built a strong deposit and loan business. It serves large corporations in all industries and is the leading bank for US middle-market companies, as well as for small businesses. Wells Fargo was the number-one US bank by market value at the end of 2015. With a balance sheet that grew by 6% last year to $1.8 trillion, the bank returned $12.6 billion to shareholders in 2015 through dividends and share repurchases.

The bank is continually upgrading its technology. Beginning this summer, corporate customers will be able to sign on to Wells Fargo’s corporate banking app using an eye scan or a face-and-voice recognition system. Wells Fargo says its loans to the oil and gas industry comprise less than 2% of loans outstanding.

John Stumpf, chairman and CEO

www.wellsfargo.com

Low or negative interest rates across Europe have posed a challenge to the banking industry that is only growing as the European Central Bank pushes rates deeper into negative territory. Net interest margins have eroded across the board, forcing many banks to increase loan volumes—particularly mortgage lending—and accept higher risks in their search for yield. Banks able to generate higher fee and commission income have generally fared better than those reliant on lending margins, while those banks that are ahead of the curve in digitalization have won out both in terms of cost-cutting and winning new customers.

Although the eurozone’s economic recovery remains feeble, improving housing markets and consumer credit have helped reduce non-performing loans, enabling many banks to cut back drastically on provisioning. In fact, combined with a reduced cost of risk, lower provisions against doubtful loans has often been the largest driver of enhanced profitability. However, higher regulatory costs and the ECB’s move toward a “bail-in” model for troubled banks has hit share valuations and is likely to contribute to higher funding costs in future.

ING retains its pole position in Western Europe after turning in a sparkling across-the-board performance in 2015—not only in its Benelux home market but in Poland, as well. The bank’s underlying profitability improved sharply, with a 23.2% surge in net profit to more than €4.2 billion ($4.8 billion). Core lending recorded net growth of €21.7 billion, or 4.2%, while the bank attracted a robust €25.1 billion net inflow of customer deposits. Group CEO Ralph Hamers notes that “in 2015 our retail customer base grew by over 1.4 million customers to 34.4 million at the year-end,” and that “of this total, the number of customers selecting ING as their primary bank rose by almost 7%, to 8.9 million.” He also highlights “significant progress on increasing the pace of innovation across the company,” including the Twyp app for peer-to-peer payments and the introduction of the Moje ING platform in Poland, adding that “we are determined to deliver on our promise to both our wholesale banking clients as well as to our retail customers of providing a differentiating and seamless client experience across the globe through new technologies and services.” The bank’s fully loaded common equity Tier 1 (CET1) ratio strengthened to 11.6% at the year-end.

Ralph Hamers, Group CEO

www.ing.com

The best-capitalized of Andorran banks in terms of Tier 1 capital, Crèdit Andorrà has succeeded in growing assets under management  9.2% in recent years, to €13.6 billion in 2014. It has also expanded its international presence in Europe and the United States. The bank’s corporate social responsibility (CSR) program, carried out through its Crèdit Andorrà Foundation, which was set up more than a quarter of a century ago, has received widespread recognition. For the past decade CSR policy has been included within the bank’s strategic plan, and in 2014 more than 3% of profits were assigned to the foundation. The bank’s financial strength is underlined by its most recent figures, which state that its solvency and liquidity ratios stood at 20.3% and 73.8%, respectively.

Josep Peralba Duró, CEO

www.creditandorragroup.com

Austria’s largest bank and its main Sparkasse (savings bank) subsidiaries performed well in 2015. Net profit of €230 million was 7.3% higher than the previous year. A 4% increase in net interest income came mainly from higher volumes of both retail loans and deposits, while fee and commission income grew by 4.5%, owing to higher securities fees and lower expenses. The first €9.2 million payment into Austria’s deposit insurance fund and a higher IT spend caused operating costs to rise, but overall the cost/income ratio improved. But the biggest turnaround came from Erste’s corporate, capital markets, asset management and real estate divisions, which together turned a €31 million loss in 2014 into a net profit of €162 million. This was largely owing to a 69% reduction in impairment losses and good risk development in Austria. Besides its traditional strengths in private banking and equities, Erste has developed some groundbreaking IT innovations, such as George, a continuously updated digital banking platform that “thinks for itself” by adjusting to each customer’s needs and behavior. The bank’s return on allocated capital rose to 22.4%

Andreas Treichl, CEO

www.erstegroup.com

Belgium’s leading bancassurance player ended the year sharply up, with fourth-quarter profits of €862 million, almost double the comparable result in 2014. KBC Group’s profit for the year rose to €2.6 billion on the back of strong performances in selling bank-insurance products and services, mainly to retail customers, small and midsize enterprises (SMEs) and mid-cap companies. Against a background of low interest rates and only modest economic growth, KBC’s Belgian operations lifted full-year profit to nearly €1.6 billion on the back of loan growth and higher non-life-insurance premiums. Profit was boosted by the one-off effect of the liquidation of KBC Financial Holding, but this was partly offset by impairment on goodwill. Faced with higher minimum capital requirements, CEO Johan Thijs commented, “We feel comfortable with these targets, which have already been factored into our capital management models—which is why we were able to pay back the last remaining tranche of €2 billion of state aid five years ahead of schedule.”

Johan Thijs, CEO

www.kbc.com

There has been much heavy lifting and restructuring at Hellenic Bank since the Cypriot banking crisis and bail-in of 2013, but an important corner has been turned with the bank’s reporting a €13 million profit for 2015—in contrast to the previous year’s €118 million loss. CEO Bert Pijls notes, “We have achieved this whilst taking all provisions as guided by our regulators, which totaled €71 million.” Moreover, the bank has made further progress in reducing nonperforming exposures, which dropped by 3% over the final quarter, while coverage increased to 50% and is now in line with the average for the European Union. Some €377 million in new loans were concluded in 2015, and net interest income posted a 6% gain. Following additional provisions, the bank’s CET1 capital adequacy ratio rose to 14.8%.

Bert Pijls, CEO

www.hellenicbank.com

France’s most highly rated and consistently profitable mutual bank, Crédit Mutuel put in another strong performance in 2015. Loans were up by 5.5% to €386 billion, giving it a 17.2% share of the country’s retail bank lending market. Deposits grew by 7.7% over the year despite the low-interest-rate environment, further improving the group’s loan-to-deposit ratio and decreasing its dependence on market refinancing. Crédit Mutuel scores highly in terms of client relationships and their trust in the bank, and it continues to build on services provided by the branch network through its websites and adapted services for iPhones and iPads. Its card payment business is the second largest in France, with a 19.3% market share, and continues to grow—as does its mainly non-life insurance business, which contributed 31% to group income. Net banking income was up by 5.9% to €16.3 billion, with fees and commission income growing by 9.6% on the back of stronger lending activity, particularly housing loans. Overall net income rose 2.2% to above €3 billion, while shareholder equity increased 7.1% to €47.1 billion. The group’s CET1 capital adequacy ratio stood at a solid 15.8% at the year-end.

Michel Lucas, chairman

www.creditmutuel.fr

When German bank shares were in free fall last January, Commerzbank did more than anyone to restore confidence by declaring it could pay the coupon on its Coco bonds and deliver on its proposed dividend for the 2015 financial year. Chairman Martin  Blessing had good reason to be confident. The bank’s operating profit surged from €689 million to more than €1.9 billion on the back of stronger revenues and sharply lower loan loss provisions. Higher revenues reflect Commerzbank’s strong share of corporate loans, particularly among “Mittelstand” companies (SMEs), supported by its dense network across the country. Private customers generated a 65% increase in operating profits, a sign that Commerzbank has successfully rebooted its retail franchise. Its newly designed website has been well received and has improved online banking security. The bank’s capital buffers were further reinforced with a €3.8 billion increase in core regulatory capital, resulting in an improvement in its CET1 ratio, from 9.3% in 2014 to 12%. Blessing commented that the results showed “our strategy is right and that the implementation has been successful. For the first time in five years we have attained a net profit of more than one billion euros and have seen further significant strengthening of our capital base.”

Martin Blessing, chairman

www.commerzbank.com

All Greek banks faced catastrophe in 2015. The possibility of leaving the eurozone triggered massive withdrawals before the banks were shut down, and the ensuing damage to Greece’s economy made the recession deeper still. Of all the major banks that have come through this turmoil, Eurobank Ergasias has fared better than any of its peers, coming out of the latest European Community Bank stress tests with the lowest aggregate capital shortfall of any systemic bank. Following the share capital increase of last November, which was supported by cornerstone international investors, Eurobank is 97.6% owned by private investors, with the balance held by the Hellenic Financial Stability Fund. From this position of relative capital solidity, it is well placed to leverage its traditional strengths in trade finance, treasury and cash management, private banking and fund management, to return to sustainable growth.

Fokion Karavias, CEO

www.eurobank.gr

Amid a resurgent Irish economy and rising house prices, Bank of Ireland steamed ahead in 2015. Underlying profit rose by 30% to €1.2 billion, as Ireland’s largest and best-capitalized bank increased its lending by 40% to €14.2 billion, with all trading divisions reporting a profit on the back of higher margins and lower cost of funding. Profitability has also been boosted by new loans, replacing some legacy assets, and, since the real estate market has picked up, lower loan loss provisions for past property-secured lending. Bank of Ireland has redeemed the final €1.3 billion of outstanding preference shares issued as part of the government bail-out in 2008-2009 and had its credit rating restored to investment grade by all three major agencies. The bank’s fully loaded CET1 ratio increased by 200 basis points to 11.3% at year-end.

Richie Boucher, CEO

www.bankofireland.com

Intesa Sanpaolo stands head and shoulders above its Italian rivals in terms of both profitability and capital strength. And judging from its 2015 results, that lead is growing, with pretax income up 41% to nearly €4.6 billion. Moreover, this growth is broad-based and, in a low-interest-rate environment, more commission-driven.

All of its divisions generated higher income. Private banking contributed 32% more on the back of its leading market share, asset management was up by 47%, and Banca dei Territori (Intesa Sanpaolo’s domestic commercial banking unit) posted a 26% improvement. Operating income grew by 5%, largely as a result of an 11% increase in fees and commissions, while continued stringent cost management lowered the group’s cost/income ratio by 1.22 percentage points to 49.9%. Provisions were down as the credit environment continued to improve, and the bank increased new medium and long-term lending to Italian households and businesses to €41 billion—54% more than in 2014. The stock of nonperforming loans declined and NPL cash coverage increased to 47.6%. The bank’s capital base comfortably exceeded regulatory requirements with a pro forma, fully loaded CET1 ratio of 13.1% net of the proposed cash dividends of €2.4 billion.

Carlo Messina, CEO

www.intesasanpaolo.com

State-owned BCEE Group is strongly focused on its home retail market, where it maintains important market shares in mortgage and consumer lending. As a result, nearly half of all Luxembourg residents consider BCEE their principal bank, and it continues to invest in its network by opening new branches equipped with the latest technologies, including “self-banking” machines, Wi-Fi access and tablets for customers to use. Equally important to its customers is BCEE’s AA+ rating and its conservative approach to risk management. During 2015, banking income increased by nearly 6% to €340 million at the halfway stage, with net interest income up 1.8% despite a low-interest-rate environment. Commission income grew by 12.9%, while income from securities increased by 5.9% over the previous year. The group’s balance sheet grew by 5.2% in six months, largely because of increased deposits, while loans and advances to clients were 5.5% stronger. An adjustment for the cost of credit risk and provisions for higher taxes—up by more than 40%—reduced net income by 4.6%  to €161.7 million.

Jean-Claude Finck, CEO, president and president of the management board

www.bcee.lu

With the Maltese economy performing well, its largest lender, Bank of Valletta, lifted  pretax profits by 13% to €144.7 million in 2015. Lending grew by 4%, and deposits by 20%, over the year. The net interest margin increased by 15%, while commission and trading income was 17% higher than in 2014. The quality of the loan book improved as the NPL ratio dropped to 9.2%. Operating expenses rose by 16%, largely as a result of higher regulatory costs, and while the bank has a cautious policy on provisioning, its overall cost-to-income ratio improved to 41.8%. In addition to its traditional strengths in trade finance, Bank of Valletta is moving toward a customer-centric approach to retail banking and expanding its online and mobile offering, with BOV Mobile registering more than two million log-ins over the year. The equity base increased by 9%, and the CET1 capital adequacy ratio improved to 11.3%.  

Charles Borg, CEO

www.bov.com

ING benefited from an improving economy and housing market, which helped shave €117 million off risk costs. Net interest income from retail banking declined by 5.8%, largely owing to lower lending volumes and margins in a very low interest-rate environment, but this was offset by higher fee income. Operating expenses were cut by 23% over the year, and underlying income fell by 0.4% to €1.1 billion. ING has been ahead of the curve in responding to changing customer needs, and CEO Nick Jue affirms this will continue. “We strive to empower people to make better financial decisions,” he says, “by providing the right information and tools at the right time, supported by clear and easy products and services available anytime, anywhere. Our new peer-to-peer app, Twyp—described as the ‘WhatsApp of payments’—is another example of that. But we are equally proud of our achievements in wholesale banking, thanks to our strong and long-standing client relationships, our in-depth knowledge of our clients’ markets, and their sectors, combined with our large international network.” 

Nick Jue, CEO, Ing Netherlands

www.ing.com

Portugal’s highest-rated and most consistently profitable bank increased its net income by more than 50% to €291.3 million in 2015 and raised its return-on-equity ratio to 9.2%, as against 6.7% the previous year. This was achieved, says CEO António Vieira Monteiro, “by growing revenues by 14.9.% and cutting costs by 4.2%”. He points to “the increase in deposits by 7.3% and a 6.8% growth in loans to companies” as indicating the market’s confidence in the bank’s solidity. The bank’s NPL ratio improved to 3.3%, and it has the highest NPL coverage of any Portuguese bank. Highly rated in terms of customer experience and innovative services, the bank launched its new App Santander Totta, providing customers with continuous access to their accounts while simplifying frequent operations. Late in 2015, Santander Totta acquired most of Banif, and with it the leading financial institution in Madeira and the Azores. The bank’s CET1 ratio stood at 14.7% after the acquisition of Banif.  

António Vieira Monteiro, CEO and deputy chairman

www.santander.pt

With the Spanish economy and housing market finally picking up, the country’s largest retail lender turned in some sparkling figures. Profits were up 31.4%, to €814 million, on the back of higher net interest and fee income, improved margins, controlled costs and a 23.6% drop in loan loss provisions—the NPL ratio coming down to 7.9%. CaixaBank’s leading position in the domestic market, where it has achieved 28% market penetration for individual customers, was reinforced by its acquisition of Barclays’s retail and corporate banking, along with its wealth management business, early last year. Already a leader in online banking through Linea Abierta, with 4.8 million customers and 34% market share, it also ranks among the world’s best mobile-banking providers with its CaixaMóvil platform. In developing big data as a tool for personalizing the bank’s offering and speeding up decision-making processes, CaixaBank has partnered with Oracle to create a powerful and secure data repository. A pioneer in the use of contactless cards, CaixaBank was the first bank in Europe to launch a Visa contactless wristband. And targeting younger customers, it has launched imaginBank, Spain’s first mobile-only bank connecting exclusively through mobile apps and social networks. At the year-end, the bank’s Tier 1 common equity ratio was little changed, at 12.7%

Gonzalo Gortázar, CEO

www.caixabank.com

With total assets of SFr154 billion ($161 billion), ZKB is the largest of Switzerland’s many cantonal banks, with a leading share in the domestic banking market, particularly in the Greater Zurich Area. It has some of the highest credit ratings of any bank in the world. Despite 2015’s challenging low-interest-rate environment, ZKB achieved a group profit of SFr722 million in 2015, an increase of 12% on the previous year. Operating income grew by 14% to more than SFr2.2 billion, much of the increase owing to higher commission and fee income following the acquisition of a smaller cantonal bank, Swisscanto, in 2014. Net interest income rose by 3% on the back of higher mortgage volumes, while fees and commissions generated 26% more income.  CEO Martin Scholl said the results “demonstrate the strengths of our well-diversified business model,” adding that “as a result of the successful integration of Swisscanto, we will have even broader income streams in the future.” ZKB is one of several Swiss banks being investigated by the US Department of Justice on suspicion of assisting tax evasion. The bank’s CET1 ratio was 15.8%, compared with 14.6% at the end of 2014.

Martin Scholl, CEO

www.zkb.ch

Santander is neither a challenger nor an incumbent in the UK market. Rather, it is three legacy building societies acquired by its Spanish parent and consolidated into a successful, strongly customer-focused banking franchise—a process underpinned by early integration within Santander’s cutting-edge global IT systems. The bank has been growing its share of the UK market though such innovative products as its 1/2/3 World current accounts, where customer numbers have increased from 1.3 to 4.6 million over the past three years. At the same time, customer satisfaction has risen compared with that of its main competitors. Lending to companies increased by 10% in a subdued market, while net mortgage lending rose to nearly £153 billion ($216 billion). Net interest income rose above £3.5 billion, and impairment losses on loans were sharply down, generating a 20% increase in pretax profit, to £1.8 billion. But that was before making a £450 million provision for the historic misselling of Payment Protection Insurance, which lowered profits in 2015 to £1.34 billion. CEO Nathan Bostock points out that “with a CET1 ratio of 11.6%  and leverage ratio of 4%, our capital strength is clearly demonstrated in the latest stress test results, with regulatory thresholds comfortably exceeded.”

Nathan Bostock, CEO

www.santander.co.uk

The leading banks in the Nordic region are among the most strongly capitalized and efficient in the world. Nonetheless, they have been facing strong headwinds. Denmark led the way into negative interest rates and Sweden—after briefly raising rates to curb house price inflation—had to follow suit. That eroded margins on lending, so the most profitable banks have been those able to capitalize on their ability to generate fee and commission income from fund management and other value-added activities, while at the same time cutting costs through ongoing digitalization and the introduction of innovative online and mobile apps.

Demand for loans varies greatly between Nordic countries, with Sweden experiencing 4.5% economic growth at the year-end while Norway has suffered from low oil and gas prices and Finland’s recovery has been hesitant. Rebuilding public trust is another priority, following boardroom scandals at two of Sweden’s leading banks and, more recently, the resignation of Iceland’s prime minister after the Panama Papers revealed his interest in an offshore company that was a creditor to Icelandic banks.  

In a year marked by geopolitical tensions, market volatility and ultra-low interest rates, Nordea raised group operating profit to €4.79 billion ($5.45 billion)—an increase of 7% over 2014, or 11% when accounted for in local currencies. Lending margins were shaved, with net interest income 7% down, but fee and commissions generated 6% more income, and both operating costs and net loan losses were significantly lower.

CEO Casper von Koskull comments: “Nordea has over the last decade delivered the most stable results in the Nordics, and last year our ROE [return on equity] of 12.3% was the highest since 2008. This strength and stability come from a diversified geographical exposure across eight home markets (including the Baltics) and a very broad product portfolio. Digitalization has continued to be the main driver of change in retail banking, where we continuously develop new features and functionalities. Our wholesale banking business has secured a substantial lead-bank footprint in all the Nordic markets and number-one position overall, and our wealth management had the strongest financial result ever, as profits grew beyond €1 billion.”  The group’s capital base was again strengthened with its CET1 ratio rising from 15.7% to 16.5% at year-end.

Casper von Koskull, CEO

www.nordea.com

Operating in what CEO Thomas F. Borgen describes as “a challenging environment,” with negative short-term interest rates, Denmark’s largest bank increased net profits before goodwill impairments by 36%, to DKr17.7 billion ($2.7 billion), despite total income of DKr44.2 billion remaining flat.

The improvement in profitability came from a combination of higher customer activity, cost reductions (operating expenses were down 4%) and considerably lower loan impairments (down 98%). The Tier 1 capital ratio stood at 21%, and the board of directors has initiated a DKr9 billion share buy-back program for 2016 in order to better reflect Danske Bank’s capital targets. 

Danske is creating a new, separate wealth management unit, as wealth management is an area of the Nordic marketplace in which CEO Borgen anticipates considerable growth over the next few years. 

Thomas F. Borgen, CEO

www.danskebank.com

The recently partially de-merged Pohjola Bank is part of the OP Financial Group, Finland’s leading provider of home and corporate loans, which celebrated a bumper year in 2015. Pohjola’s earnings from banking were up 10% to €334 million out of a group total of €652 million, although after allowing for a change in fair-value reserves, earnings before tax fell to €511 million.

Total expenses remained at the same level in 2015 as at the end of 2012. The bank generated return on equity of 14.8% and improved from 14.3% the previous year; the CET1 ratio stood at 14.1% at year-end.

Jouko Pölönen, president and CEO

www.pohjola.fi

Iceland’s largest bank saw net profits increase last year to ISK 36.5  billion ($289 million), compared to ISK29.7 billion in 2014, and ROE improved to 14.8% from 12.5%. CEO Steinthór Pálsson commented: “Liquidity is strong and the bank’s equity is amongst the highest on record, despite large dividends being paid.” Its capital adequacy ratio was 30.4% at the year-end, and the liquidity ratio stood at a healthy 113%. Already holding the country’s largest branch network, the bank’s integration of two recently acquired regional savings banks has strengthened its position outside the capital region of Reykjavik.  The bank has also introduced a range of innovative mobile solutions, and recently the Icelandic Web Awards panel named Landsbankinn has having the best online service portal for the second year in a row.

Steinthór Pálsson, CEO

www.landsbankinn.com

Despite the slowdown in Norway’s oil-based economy and a weakening currency, Nordea managed to raise its net profit in 2015 by 3% to above NKr5.1 billion ($610 million). CEO Snorre Storset points out that “last year our growth in assets under management was 17.5% to NKr105 billion, and we also increased our household lending by 9%.” Norway’s second-largest bank saw operating income and profit slide by 3% and 2% respectively, but a sharp decline in loan losses produced a positive net result.

Nordea Norway remains at the forefront of technological developments, and, as Storset points out, “we launched a new version of Nordea’s mobile bank with fingerprint login and tools for investors to trade directly from their smart phones.” The bank is also the second-largest manager in the Norwegian bond market, with a 24% market share. Capital buffers were further strengthened, the bank’s core Tier 1 ratio rising 3 percentage points to 15.7% at year-end.

Snorre Storset, CEO

www.nordea.no

SEB has maintained its position as the leading wholesale bank among corporate and institutional clients in Sweden and is now engaged in growing its customer base among SMEs and private clients, with a strong position in savings, where it has the second-largest share of household aggregate savings. Ultra-low and then negative interest rates eroded lending margins, resulting in a decline in both operating income and profitability, despite a sharp reduction in operating costs. Nonetheless, SEB’s Swedish operations provided 56% of total group operating profit last year. Overall, return on equity was 12.2%, and the bank’s solidity is reflected in its 18.8% CET1 ratio.

Annika Falkengren, president and CEO

www.sebgroup.com

Leaning Into The Headwinds

In 2015, Central European banks within the EU—regardless of whether their countries had adopted the euro or retained their own currencies—fared much better than those on further fringes of the Continent. 

Russian banks faced considerable headwinds due to a combination of low energy prices, a contracting economy and Western sanctions—though the latter opened up opportunities for privately owned Russian banks to step into the gap, extending their loan books and sucking in deposits from state-owned and other banks subject to sanctions.

The same was true in Ukraine, where private Russian concerns have been buying assets from Western European banks keen to exit this troubled market. The all-eurozone Baltic States forged ahead, while south eastern Europe presents a more mixed picture, with Romania recovering strongly while banks in many of the smaller Balkan states are still held back by non-performing loans.

But the strongest results came from leading banks in the EU’s eastern growth area—Poland, the Czech Republic and Slovakia—which has long been the strategic focus of this year’s regional winner, Erste Group. Its CEO, Andreas Treichl, is concerned that ultra-low interest rates could push banks toward riskier lending, encourage financial bubbles and create ‘social disparity’ by penalizing savers.
 

Erste Group turned around its massive €1.4 billion ($1.6 billion) loss in 2014 to report a net profit of €968.2 million in 2015. This was largely attributable to significantly lower risk costs combined with a sharp decline in impairments from over €2 billion in 2014 to €729 million. The group’s nonperforming-loan ratio dropped to 7.1%, the lowest in five years, partly as a result of the successful sale of NPL portfolios in Croatia and Romania, but also because of a broad-based improvement in asset quality as economic growth accelerated to nearly 2% in Erste’s core Central and Eastern European markets. CEO Andreas Treichl comments that “this confirmed the validity of our customer-centered business model and our strategy of positioning Erste Group as the leading retail bank in the EU’s eastern growth area.” Certainly, by focusing more tightly on Central Europe, Vienna-based Erste has avoided the heavy losses incurred by rival CEE banking franchises in Russia, Ukraine and the Balkans. Stronger core market demand for loans translated into Erste’s increasing its lending by 4.2%, though margins were down because of low interest rates. Return on equity (ROE) was 9.3%. The group’s solid capital position, with a fully loaded Common Equity Tier 1 (CET1) ratio of 12%, has allowed it to restore dividends.

Andreas Treichl, CEO

www.erstegroup.com

Despite difficult market conditions last year, Raiffeisen retained its leading position in Albania, with more than 21% of all banking assets. Profits before tax were down 14% to €28 million. The bank continues to focus on promoting the use of technology in its retail banking operations, and last year electronic transactions increased by 38%, with the number of customers with access to e-channels reaching 75,000. With nearly 200 ATMs across the country, the bank offers wider coverage than any of its competitors, and the point-of-sale (POS) network was extended in 2015 to 35 cities. Raiffeisen continues to lead in the Albanian debit card market with 53,000 new debit cards issued last year.  The thiird-quarter loan-to-deposit ratio stood at 44.2%, and ROE at 15.5%.

Christian Canacaris, CEO

www.raiffeisen.al

By far the most profitable and efficient bank in Belarus, Priorbank is a subsidiary of Raiffeisen Bank International and has been growing its business across the board. Total assets increased by 26.5% during 2015, with the loan book up by 15% while deposits grew by almost a third. Gross income was up 71.5%, and tight cost controls, including reducing the number of branches and head count, helped generate a post-tax profit almost 140% higher than in 2014.

The bank’s profitability has been built on growing its market share in lending to individual customers rather than legal entities, though it continues to upgrade its offering to corporate customers and entrepreneurs by introducing cash pooling products—a first in Belarus. Last year it also introduced electronic plane-tables for cash-desk services, thereby reducing document workflow by 70%. In November, it rolled out its new system of real-time validation of a caller’s identity using voice biometric technology. The bank’s equity increased 11%; ROE rose by more than 100% over the previous year.

Sergey Kostyuchenko, CEO

www.priorbank.by

Raiffeisen is Bosnia’s second-largest bank but consistently outperforms in efficiency, profitability, customer service and innovation. According to CEO Karlheinz Dobnigg, “Although 2015 was a challenging year, we posted a net profit of €34 million and improved products and processes, which further strengthened our market position.” He credits growth in the lending business and increased savings of private individuals. Lending increased to more than €1 billion, and deposits to above €1.5 billion.

Karlheinz Dobnigg, CEO

www.rbb-sarajevo.raiffeisen.at

The country’s leading bank in terms of loans, deposits and total assets, this member of the Italian UniCredit Group increased its dominant market share in corporate and investment banking and climbed to second place in retail banking. Customer deposits grew by nearly a quarter to 13.3 billion Bulgarian levs ($7.7 billion)—the largest volume of new deposits in Bulgaria. UCB retained its leadership in payment cards and continued development of its internet service YourFinancialAdvisor.bg with innovative functionalities like investment modules, while its Private Cloud project—the first of its kind in Bulgaria—is furnishing capacity for virtual machines over the next three years. UCB achieved the best cost-to-income ratio among the country’s leading banks, at 30.4%. Gross operating profit increased by 6.2% in 2015. A return on assets (ROA) of 2% meant it outperformed the market in profitability, while ROE improved by 0.9% to 13.4%. 

Levon Hampartzoumian, CEO and chairman

www.unicreditgroup.bg

A member of the Intesa Sanpaolo Group, PBZ has the country’s most extensive branch network and a 17.4% market share in terms of total assets.  The balance sheet remained unchanged at 78.4 billion Croatian kuna ($11.9 billion). Croatia’s banking sector had a difficult year in 2015 as a result of the forced conversion of Swiss-franc-pegged loans on top of an economic crisis. PBZ’s net profits were down to 365 million kuna, largely due to a 1.3 billion kuna loss incurred from Swiss-franc conversion. The bank’s president, Božo Prka, commented that “without this imposed and heavy negative effect, our results could easily be described as exceptional.” Improved control of risk paid off, with the bank’s nonperforming-loan ratio down from 13.9% to 11.9%. Net interest income increased by 2.5%, and ROE was 2.7% at year-end.  PBZ has concentrated on offering its customers the latest technology, being the first bank in the country to introduce HCE for near field communication mobile payments, and over 90% of its payment transactions now take place through electronic channels.

Božo Prka, president

www.pbz.hr

CSOB achieved strong growth across all its businesses in 2015, becoming the Czech Republic’s largest lender overall and maintaining its market leadership in mortgages, mutual funds and leasing. Total assets increased by 10% year-on-year on the back of growth in mortgages, SME/corporate loans and leasing. Overall, loans and deposits were up by 6% and 5%, respectively. Net profits progressed by 3% to 14 billion Czech koruna ($600 million), supported by volume growth and the strong performance of financial markets. Investment in digital services and restructuring drove up operating expenses by 5% year-on-year. Nonperforming loans decreased by 43 basis points to 3.64%, and the group’s Common Tier 1 capital adequacy ratio increased to 19.1% at year-end. CSOB’s strategy, based on the bancassurance model, is to leverage its position as the only Czech bank with an in-house insurer, through multichannel contact with customers. It continues to upgrade online navigation to meet clients’ financial needs through smartbanking. 

John Arthur Hollows, CEO and chairman

www.csob.cz

“In spite of the challenging economic environment, our strategy of deepening customer relationships has worked well,” says the head of Nordea Estonia, Petri Nikkilä. “As a result we have seen income increase by 13% and operating profit by 18%.”  Net commission income rose by nearly a third, household deposits were up by 21%, and the overall loan book expanded by 2%, according to the bank. Net profit was 26% higher than in 2014, and the bank’s customer base increased by 3%. Nikkilä says customer response to its new online meeting tools, such as its Online Advisory Branch, has been enthusiastic.

Petri Nikkilä, head of Nordea Estonia

www.nordea.ee

In 2014, TBC became only the second Georgian company to list on an international stock exchange, with its successful London IPO. Last year, the bank hit another milestone when it completed its merger with Bank Constanta and became Georgia’s largest retail bank by deposits. TBC also leads the market in internet and mobile banking as well as branch efficiency. This year, TBC is capitalizing on both these strengths as part of a plan to redesign its branch banks to better utilize technology for customer comfort and convenience. The first redesigned branch opened in December.

Vakhtang Butskhrikdze, CEO

www.tbcbank.ge

Hungarian banks have faced a series of levies and fines for forex lending and alleged anti-competitive behavior, which together with restrained loan demand and lower margins in a low-interest-rate environment have impacted profitability. OTP Group posted an adjusted profit of 120.2 billion Hungarian forints ($439 million) in 2015, representing a 2% increase over the previous year. In Hungary, OTP’s core banking operation contributed income of 123.4 billion forint. Erosion of assets under management and fee income at its fund management arm slowed during the year. The Hungarian bank retained its market leadership by total assets, deposits, housing loans and asset management, and even in the corporate segment where it is not the biggest player managed to gain market share. 

Sándor Csányi, chairman and CEO

www.otpbank.hun

TEB, a subsidiary of BNP Paribas, had a good year in 2015, continuing to build on its leading market share, with total assets increasing by 11.2% to €410.6 million and the loan portfolio up 8.9%. Shareholders’ equity grew by more than 50% to €52.9 million owing to higher retained earnings. ROE was 48.6% up as a result of an 87.2% jump in after-tax profits to €17.3 million. TEB continues to focus on adding functionality to its innovative multichannel banking network, and last year it held an 81% market share in the credit card market and a 27% share of ATM transactions.

Ayhan Albeyoglu, managing director

www.teb-kos.com

Nordea Latvia’s total income grew 22% last year to €69.5 million, despite geopolitical tensions and market turmoil. “We have succeeded in delivering stable growth,” says the head of Nordea Bank in Latvia, Janis Buks. Lending volumes were stable, net interest income grew slightly to €52.4 million, and commission income jumped by 17% to €10.8 million. Total deposits grew to more than €1.5 billion on the back of an 8% increase in household deposits. Buks highlights ongoing improvements in customer service, including offering “modern and innovative digital solutions” such as the newly launched Nordea Netbank app for iPad.

Janis Buks, head of Nordea Bank Latvia

www.nordea.lv

In a year which began with Lithuania adopting the euro and ended with its accession to the Single Euro Payments Area (SEPA), Šiaulių Bankas completed the acquisition of the Finasta banking and brokerage businesses and reported record financial results.

Net profit at both group and bank level were double that achieved in 2014, thanks to a  23% higher net interest income built on 17% growth in the loan and leasing portfolio and sharply lower costs. Net fee and commission income surged by 24%. “The bank accomplished its structural rearrangements and gained much experience in shaping its value-based organizational structure,” says CEO Vytautas Sinius, “laying a strong foundation for further sustainable and responsible performance.” Following an increase in its authorized capital and other capital-strengthening measures, by year-end its capital adequacy ratio (CAR) of 14.3% provided a comfortable cushion.

Vytautas Sinius, CEO

www.sb.lt

A member of the Société Générale Group, Ohridska Banka had its most successful year ever in 2015, reflecting growth in commercial activity across all segments of the business. Net banking income improved by 22.1% to €23.7 million, and ROE improved by 5.4% to 16.5%.  Higher interest income from loans, decreased expenses in the deposits operations and an increase in net fees and interest income all contributed to the improved results. Assets grew by 3.7%, giving a market share of 7.8% with Ohridska retaining its fourth place in the Macedonian banking market. The volume of both loans and deposits remain on an upward trend.

Branka Pavlovic, president

www.ohridskabanka.mk

Despite Moldova’s difficult economic situation, the country’s largest bank continued to perform well, with latest figures reporting a net income of 130.6 million Moldovan leu ($6.7 million), the highest in the local banking system. The bank retained its leading share in terms of assets (26.4%), loans (29.1%) and private deposits (30.1%). During 2015, Agroindbank expanded its distribution network substantially, opening 74 new agencies across the country, and increased its investment in electronic solutions with the introduction of five self-service centers and the acceptance of contactless cards at over 1,000 POS.

Serghei Cebotari, chairman

www.maib.md

Last year ING Bank Ślaski acquired nearly half a million new retail customers and some 10,000 additional corporate clients. Its loan book grew by 19%, while deposits were up by 16% over the year. Total income rose by 7% to 3.78 billion Polish zlotys ($970 million), and net profit improved by 8% to 1.13 billion zlotys. The nonperforming-loan ratio of 3.2%  is less than half the average figure for Polish banks, and the bank’s total capital ratio stood at 13.7% at year-end. The bank is actively leveraging technology, with, for example, the recent introduction of Moje ING, its new, fully responsive online platform, and its counterpart for corporate clients, ING InsideBusiness. “We are working hard to bring a differentiating customer experience to both retail and corporate customers,” says CEO Malgorzata Kolakowska.    

Malgorzata Kolakowska, CEO

www.ingbank.pl

Part of France’s Groupe Société Générale and the second-largest bank in Romania in terms of assets, BRD saw net profits surge to 487 million Romanian leu ($124 million) last year from 68 million leu in 2014. The bank attributed the rise to a combination of lower operating expenses (down 2.3%) and ongoing improvement in risk costs (down 48.7%). CEO Philippe Lhotte welcomed “a positive trend on two important business lines—retail and large corporate clients—and the shift to sequential growth of quarterly revenues.” The NPL ratio fell to 17.1% from over 20% the previous year following a number of write-offs, while the volume of new loans rose by 22%. Deposits continue to grow faster than the market at 13.9% year-on-year.  ROE was 7.8% and the CAR stood at 17.3% at year-end.

Philippe Lhotte, CEO

www.brd.ro

The combination of Western sanctions and low commodity prices has made life difficult for Russian banks, especially state-owned and other “Kremlin-friendly” banks targeted through sanctions. Privately owned Credit Bank of Moscow has fared better than most. During 2015 it grew its loan book by 115% and attracted 142% more customer deposits, especially from corporate clients whose deposits at CBM more than trebled over the year. Total assets more than doubled to 1.18 trillion rubles. Net interest income grew by 25% and fee income by 17%, but CBM’s conservative stance on provisioning in the face of macroeconomic headwinds meant that net income, after writing down loans, came in at 3.9 billion rubles ($57 million)—a steep decline from the previous year’s 6.4 billion rubles. The bank moved to strengthen its capital buffers through an initial private offering on the Moscow Exchange with an 18.8% free float that yielded 13.2 billion rubles, followed by a 16.5 billion ruble secondary private offering in December. Further capital was raised through a $300 million subordinated deposit, resulting in a material increase in the bank’s capital adequacy ratios.     

Vladimir Chubar, chairman

www.mkb.ru

This member of the Italian international banking group Intesa Sanpaolo has held the top spot in the Serbian banking market in terms of total assets, loans and deposits since 2007 and continues to strengthen its position. Its asset base grew by 3.1% last year, with the return improving from 1.6% to 2%. Operating income was up 13.8% to 23 billion Serbian dinars ($210 million). The bank’s retail segment performed particularly well, with personal loan volumes increasing in part because of a targeted marketing campaign aimed at a new customer segment, including pensioners, and a 14% increase in premium banking customers.  The bank’s pretax profit surged by 36.4% to 9.7 billion dinars, while the ROE of 8.8% was almost 2% higher than the previous year.

Draginja Djurić, CEO

www.bancaintesa.rs

A part of the Intesa Sanpaolo international banking group, VÚB turned in a solid performance in 2015. Pretax profits rose significantly to more than €170 million, on the back of increased loan volumes, strict cost controls and higher fee and commission income. These more than compensated for a slight fall in net interest income to €413 million as a result of low base rates and tougher competition. VÚB held down its cost/income ratio through ongoing efficiencies and increased digitalization. Customer deposits held firm above €8 billion, and operating profit before impairments rose by nearly 10% to €222 million. Capital adequacy remained strong, at nearly twice the minimum requirements set by the central bank.

Alexander Resch, chairman and CEO

www.vub.sk

Profitability at UniCredit’s Slovenian subsidiary increased dramatically last year, recording a €11.6 million pretax profit—compared with just €600,000 in 2014. CEO Stefan Vavti noted that “retail credit demand has stabilized or even strengthened while deposits are rapidly accumulating, although savers can no longer expect such high interest rates and [take] the security of their savings more into consideration when selecting their banking partner.” UCB’s customer deposits grew by 33% to €452 million over the year. Net fee and commission income was up by 1.2%, but net interest income fell by 7.8% (compared to the overall banking sector’s 10.6% decline). The bank strengthened its capital buffers, with its CET1 ratio rising to 20.24%.  Impairments were 41.2% lower than in the previous year.

Stefan Vavti, CEO

www.unicreditbank.si

Consistently one of the best-capitalized and most profitable banks in Turkey, Akbank turned in another strong performance in 2015. Total assets increased by 15.4%, while loans and deposits were up by 12.7% and 22.2%, respectively. Akbank’s selective loan growth strategy focused on the profitable, lira-denominated domestic business segment, positioning the bank for an upturn in profitability in this segment. Innovations such as “credit kiosks” for handling loan applications swiftly improve the customer experience. Net interest and fee income were up by 7.1% and 2.1%, respectively. The bank’s core operating income increased by 18% on a comparative basis, but new regulatory requirements for higher provisioning and fee rebates reduced the bank’s net income from 3.66 billion lira ($1.3 billion) to a reported 3.29 billion lira. These factors also had a negative impact on reported ROE of nearly two percentage points, bringing it down to 12.1%. Effective risk management helped keep the bank’s NPL ratio down to 2.2%, well below the 3% average for the banking sector. Akbank’s Tier 1 capital ratio was 13.3% at year-end.

Hakan Binbaşgil, CEO

www.akbank.com

A combination of Russian-backed secessionists in Eastern Ukraine, an economy increasingly dependent on IMF and EU support, high levels of corruption and excessive bank lending to “related entities” does not make an inviting climate for investment. But Russian billionaire Mikhail Fridman and co-investors in Luxembourg-based ABH Holdings, the owners of Alfa-Bank Ukraine, are jumping in anyway. Last January they bought UniCredit’s unprofitable banking subsidiary, Ukrsotsbank, thereby more than doubling their presence in Ukraine. Even before that, Alfa-Bank’s owners had twice increased its charter capital, and now that Ukraine’s central bank has agreed to a further recapitalization, CEO Rushan Hvesyuk confirms that this will also go ahead. “We reiterate keeping our development strategy in Ukraine,” he said, calling it one of the most promising markets the bank serves. The bank scored highly in the Ministry of Finance’s qualitative assessment of Ukrainian banks last year, being rated top bank by users as opposed to industry members.

Rushan Hvesyuk, CEO

www.alfabank.ua

As Latin America’s recession continues to be driven by weakened commodity prices and severe GDP contractions in Brazil and Venezuela, global banks are exiting the region in an effort to cut their losses. HSBC sold its Brazilian retail unit to Bradesco last year, while Citigroup began seeking buyers for its retail operations in Brazil, Argentina and Colombia. Deutsche Bank, Barclays and Societe Generale also joined the exodus. “Global banks exited Latin American countries during other periods of economic crisis as well,” said Fitch Ratings in March. “However, this time the exodus seems to be more definitive and not driven solely by the economic cycle.”
 

Despite Latin America’s complex operating environment, BBVA remained profitable. In 2015 the bank posted an 8.7% rise in net attributable profit in South America and 8.8% in Mexico. Market share of loans and deposits in Mexico was 23.4% and 23.2%, respectively, while in South America it was 10.4% for both categories. BBVA forged ahead with its goal of building the best digital bank of the 21st century, continuing a $2.5 billion technology investment plan throughout the region. Investments in social programs were increased by 27% in Mexico and 7% in South America. Financial literacy remains its core corporate-social-responsibility (CSR) focus globally.

Francisco González, group executive chairman

www.bbva.com

Banco Macro’s prudent business strategy has allowed it to post 56 consecutive profitable quarters in a country undergoing both a political transition and an economic downturn. The bank is the exclusive financial agent for four provincial governments. In addition, its private-sector financing grew 42% year-on-year during the last quarter of 2015. In 2016, Banco Macro is commemorating the 10th  anniversary of its listing on the NYSE, with return on equity (ROE) jumping from 22.2% to 37.2% and share prices gaining 259% over the decade. The bank operates Argentina’s largest branch network.

Jorge Horacio Brito, chairman and CEO

www.macro.com.ar

The Bahamian banking system was battered by the rollout of a value-added tax, ratings downgrades, a deteriorating economy and the onslaught of Hurricane Joaquin in 2015. Scotiabank’s operations remained profitable but saw significant drops in profits and assets. That was the cue for the bank to launch a major restructuring to boost efficiency, which produced 7% reductions in operating and labor costs, as well introduce a new customer service strategy. Customers have remained loyal. The bank operates 14 branches, as well as Internet banking, electronic cash management and private banking.

Sean Albert, vice president and district head—Northern Caribbean

www.bahamas.scotiabank.com

Following several years of stagnation, the Barbados economy showed signs of slow recovery in 2015, posting 0.5% growth and registering its strongest tourism sector results in nearly a decade. Scotiabank took advantage of the improved outlook to restructure its operations in pursuit of greater efficiency. The bank’s assets grew 16.39% in 2015, with ROE of 15.75%. Despite increased competition from credit unions, Scotiabank maintained a 32.8% market share of personal loans and 41.7% of credit cards. The bank operates six retail branches and 23 ATMs on the island.

David Noel, managing director—Caribbean East

www.barbados.scotiabank.com

Heritage Bank presents a remarkable growth story, as it transitions from being the country’s smallest commercial bank to becoming an important market player. Founded in 2010 as a result of the merger of Provident Bank & Trust and the Alliance Bank of Belize, in 2015 it acquired the local assets of CIBC First Caribbean in an unprecedented move for the Belizean banking sector. Heritage doubled its assets and customer base, while successfully tackling labor and regulatory issues. It is an important lender to public- and private-sector borrowers.

Stephen Duncan, managing director

www.heritageibt.com

Banco de Crédito de Bolivia remains a pioneer in the country’s banking sector, becoming the first to launch mobile-wallet technology and leading the largest syndicated loan in Bolivian history, both in 2015. The bank also upgraded many of its branches and ATMs and overhauled its Internet banking platform. It operates 52 branches and 257 ATMs. In 2015 the bank posted a 20.7% growth in assets, with ROE of 12.5% and return on assets (ROA) of 1.1%. Nonperforming loans were 1.6%.The bank’s CSR efforts focus on offering training sessions for small and midsize enterprises (SMEs).

Marcelo Trigo, CEO

www.bcp.com.bo

Bradesco has much to celebrate during its 73rd anniversary. The bank closed 2015 with a 16.4% rise in adjusted net income and 4.6% growth in assets, with return on average equity (ROAE) of 20.5%. Further growth is expected, following its acquisition of HSBC’s Brazilian operations. The bank services 68.2 million clients through 4,507 branches, 4,247 ATMs and 65,851 customer service centers in Brazil, as well as 14 branches abroad. Technology investments led to 92% of transactions being handled through digital channels. Bradesco signed a $375 million partnership with the World Bank’s International Finance Corp. (IFC) to finance SMEs.

Luiz Trabuco Cappi, vice chairman and CEO

www.bradesco.com.br

Banco de Chile is one of Chile’s most respect brands, achieving a 96.8 loyalty index and a 71.3 customer satisfaction index. The bank services its 2.2 million clients through 293 Banco de Chile and Banco Edwards/Citi branches, as well as 126 within the Banco CrediChile network. Each brand focuses on a different market segment. In 2015 it ranked first in terms of net income, with 21.4% ROAE and 1.9% return on average assets (ROAA). It is a strong supporter of educational programs and the Teleton Foundation, which provides medical assistance for children.

Arturo Tagle, CEO

www.bancochile.cl

As it celebrated its 145th anniversary in 2015, Banco de Bogotá continued to consolidate its regional leadership role. Besides its operations in Colombia, the bank has expanded into six Central American markets with the acquisition of BAC Credomatic. It services nearly 18 million customers through 1,523 branches and 3,505 ATMs. Its mobile-banking application, launched in 2014, saw a 316% rise in transactions in 2015, when the bank also relaunched its website. Consolidated assets grew by 31.3% in 2015, driven by a peso devaluation. Total deposits rose 25.7%.

Alejandro Figueroa Jaramillo, CEO

www.bancodebogota.com.co

Scotiabank’s operations in Costa Rica are poised to take on a higher profile after the bank acquired Citibank’s operations in Costa Rica and Panama in 2015. The move triples the bank’s customer base in both countries. Scotiabank’s network in Costa Rica grew to 45 branches and 193 ATMs, while taking second place in the credit card market. The bank aims to retain its leadership in the mortgage and auto loan segments, while increasing its personal loan and credit card business. CSR efforts include building lodging for at-risk youth.

Jean-Luc Rich, senior vice president and general manager

www.scotiabankcr.com

Created through a bank merger in 2014, BHD León has become one of the country’s most innovative institutions. It was the first local bank to establish an environmental and social risk unit, has installed solar panels at many of its branches, supports development of women entrepreneurs and provides financial training to young Dominican baseball players preparing to join Major League Baseball teams. Fitch affirmed its B+ long-term global rating, citing the bank’s pursuit of international governance standards. It signed a $48 million partnership with the IFC TV network to provide SME financing.

Luis Molina Achécar, CEO

www.bhdleon.com.do

Pichincha is the largest private bank in Ecuador, with $8.9 billion in assets and more than 30% market share. The bank continues to expand its footprint, adding branches in Spain, where it became the first Latin American bank to receive a European banking license. It also operates banks in Colombia and Peru, as well as an agency in Miami. In 2015, Pichincha earmarked $100 million to support low-income housing construction and received an $80 million Inter-American Development Bank (IDB) loan to support SMEs. ROA was 0.7% and ROE 7.1% in 2015.

Antonio Acosta Espinosa, president

www.pichincha.com

Despite increased competition and an economy posting only moderate growth, Banco Agrícola remains El Salvador’s financial services leader. In 2015 the bank reported a 3.3% growth in its net loan portfolio, with a leading 28.4% market share. Deposits, which fell system-wide during the previous year, began rebounding and gave the bank a 27.8% market share. Net income was $72.2 million, with 13.8% ROE and 1.8% ROA. The bank maintains 67 branches, 561 ATMs and 215 customer service kiosks. Around 80% of customer transactions are conducted via electronic channels.

Rafael Barraza, CEO

www.bancoagricola.com

Initially founded as a rural development bank in 1997 to service mainly SMEs and farmers, Banrural is now the country’s second-largest financial institution. The bank, in which the government maintains a minority stake, offers personal and corporate banking services, including special products for SMEs. Its portfolio includes deposits, loans, insurance, pension funds, remittances and investments. Fitch affirmed its issuer default rating at BB, based on the bank’s solid credit quality, high profitability and good capitalization. In 2015, Banrural made a successful $108 million bid for Honduras’s Banco Continental.

Fernando Peña Pérez, CEO

www.banrural.com.gt

Ficohsa, founded in 1994, is Honduras’s largest bank, with more than 150 branches and 450 ATMs nationwide, and more than a 19% share of the sector’s net assets. It operates banks in Honduras, Guatemala, Nicaragua and Panama. Ficohsa acquired Citibank’s operations in Honduras in 2014, and in Nicaragua in 2015. The financial group has been recognized as one of Central America’s leading corporate citizens, supporting education and technology innovation among its many efforts. In 2015 the bank received a $25 million IDB credit to support foreign trade initiatives.

Camilo Atala, CEO

www.ficohsa.com

NCBJ is Jamaica’s largest financial services group and is fast becoming a Caribbean regional player. Through a series of acquisitions and expansion efforts, the bank now operates in Jamaica, Cayman Islands, Trinidad & Tobago, Barbados and the UK. In Jamaica it operates more than 40 branches and 250 ATMs, in addition to financial kiosks and ABMs (automated banking machines). Its customer base is a mix of retail consumers, SMEs, large corporations and government agencies. Total assets grew 4.9% (through September 2015), while deposits and loans grew 12.7% and 4.9%, respectively.

Patrick Hylton, group managing director

www.jncb.com

Spanish banking giant Santander’s local unit overcame the impact of a sluggish Mexican economy to post a 26.4% rise in assets, 12.4% rise in deposits and 17.7% increase in loans in 2015, when net income gained 0.9%. The bank retained its market leadership position in SME financing and expanded its branch network by 20%, including a program to open branches in hospitals. Santander services more than 12 million clients through 1,354 branches and nearly 6,000 ATMs nationwide. It aims to reach 1.8 million digital clients within three years.

Hector Grisi Checa, CEO

www.santander.com.mx

In 2015, Lafise Bancentro posted a 13.3% rise in net income, to $40.81 million, marking the best result in its history. The bank remained one of the country’s largest financial institutions, with a 25.1% market share of total assets. Its SME loan portfolio grew 10% in 2015. A 24.1% ROE made it Nicaragua’s most profitable bank. The Central American Bank for Economic Integration granted it a $15 million subordinated loan that is the largest credit facility for any Nicaraguan bank. CSR efforts are strongly focused on education.

Carlos Briceño Ríos, CEO

www.bancolafise.com.ni

Banco General, founded in 1955 as Panama’s first privately owned bank, remains the largest locally controlled financial institution. The bank holds a leading 26.4% market share of private-sector deposits and 18.9% of loans. It services more than 827,000 clients through the country’s largest ATM network (451) and second-largest branch network (69). Banco General operates a subsidiary in Costa Rica and representative offices in Mexico, Guatemala, El Salvador, Colombia and Peru. It has held investment-grade ratings from Fitch and S&P since 1997. CSR investments in 2015 were $5.1 million.

Raúl Alemán Zubieta, CEO

www.bgeneral.com

The Paraguayan subsidiary of Brazilian banking giant Itaú is the South American country’s largest financial institution, offering a full range of retail and commercial banking services. The bank holds a dominant market share of the Paraguayan credit card market, as well as a 17.82% share of total deposits and 15.11% of total loans. Its revenue accounts for 34.24% of the banking system’s total. Despite a growing competitive environment, Itaú Paraguay remains solidly profitable, with 47.66% ROE and 4.49% ROA. The bank operates a network of 43 branches nationwide.

Viviana Varas, CEO

www.itau.com.py

Loans continued to drive BBVA Continental’s success in 2015. Its net loan portfolio, which grew 13.8%, represented 59% of total assets, which also posted 29% annual growth. The bank’s NPL ratio was the lowest among its peers, at 2.17%, and below the 2.54% sector average. Its network of 331 branches is the country’s second largest, with a 15.4% market share. Its ATM network grew 6.3% in 2015, to 1,777 units. Millward Brown recognized the bank as Peru’s most innovative financial institution on the strength of its high-impact branding initiatives.

Eduardo Torres-Llosa Villacorta, CEO

www.bbvacontinental.pe

Impacted by Puerto Rico’s decade-long recession and threat of public-sector debt default, Popular has taken a proactive role in bringing the island’s economy back from the brink. It opened an investor services hub to provide services for investors seeking government incentives and partnered with the local economic development agency to lead investment promotion missions to Latin America and Europe. It reinstated quarterly dividends in 2015 and remains the island’s largest bank. Popular operates 217 branches in Puerto Rico. CSR efforts involve education, culture, economic development and sports.

Richard L. Carrión, chairman and CEO

www.popular.com

As an economic recession impedes the country’s banking sector, Scotiabank’s local unit stands out among its peers, posting a 17% rise in net income in 2015, with 15.59% ROE and 2.64% ROA. Its commercial loan portfolio grew 13%, while retail loans grew 10%. Its NPL ratio improved to 1.75% in 2015 (from 2.15% in 2014). Scotiabank’s insurance division saw an 18% growth in gross premium income and sold the largest number of policies in the bank’s history in the country. The bank is working to further improve customer service.

Anya M. Schnoor, managing director

www.tt.scotiabank.com

Scotiabank arrived in the islands in 1982 and has not relinquished its market leadership. In 2015 the bank had a 58% market share of mortgages and 85% of commercial loans, as well as a 62% share of deposits. The Canadian bank operates three branches and provides SMEs with a variety of training modules, including business plan writing and cash flow management. In 2015, Scotiabank became the first to offer mobile banking in Turks & Caicos. Its CSR efforts are focused on community development, education, sports, culture and health/wellness.

Sean Brathwaite, managing director

www.turksandcaicos.scotiabank.com

Following its arrival in the Uruguayan market in 1978, Santander has worked to become the country’s largest privately owned bank. In 2015 it had an 18.3% market share of loans and 16.3% share of deposits. Santander Uruguay’s support for SMEs remains an important contributor to the country’s economic development, as SMEs employ 60% of the local private-sector workforce. This includes a robust scholarship program that also offers special initiatives for SME training. The bank’s CSR efforts are aimed at culture, rural education, recycling, and poverty alleviation issues, among others.

Juan Carlos Chomali, general manager and CEO

www.bbva.com.uy

Since entering the market in 1963, Scotiabank has become the bank of choice in the US Virgin Islands. It offers retail and commercial banking services, including online banking and electronic cash management, and operates three branches and 17 ATMs. The bank’s CSR activities focus on arts and culture, education and sports. In 2015, efforts included ongoing sponsorship of Junior Achievement’s “Economics for Success” program, continuation of a scholarship fund with the University of the Virgin Islands, computer donations to a local high school and support for the YWCA.

Hubert de la Feld, head of Caribbean operations

www.usvi.scotiabank.com

Despite Venezuela’s economic meltdown—including a hefty GDP contraction, dwindling currency and soaring inflation—BBVA Banco Provincial had another banner year in 2015. Assets grew 86%, while lending was up 102%, to 18% market share. Commercial loans and credit cards grew by 17% and 70%, respectively. The bank’s NPL ratio improved 10bp to 0.25%. Focused on improving efficiency and meeting customer needs, it opened three new branches, for a nationwide total of 333, and maintained 2,064 ATMs. It also launched the “Road to Success” comprehensive program to support SMEs.

Pedro Rodríguez Serrano, CEO

www.provincial.com

A For years, Asia served as a bright spot in the global economy as other regions struggled in the wake of the financial crisis. China’s rapid rise fueled this growth, while associations such as Asean and regional trade agreements facilitated the region’s integration internally and with other parts of the world. Demand for oil, minerals, and other commodities boosted economies in central Asia, while the region’s more developed markets took advantage of their experiences and expertise to invest in their neighbors and advise on their growth strategies.

Asia has lost some of that luster in the past year. After decades of rapid expansion, China’s economy is transitioning to a lower, more domestically driven form of growth. Partially as a result, global demand for commodities has fallen, impacting Mongolia and its neighbors in Central Asia, as well as Australia, Indonesia, and Brunei, which derives much of its economic growth from oil production. More developed markets such as Japan and Singapore are struggling amid tepid trade conditions, intense competition, and more challenging monetary conditions.

For these reasons, Asian banks are operating in drastically different environments now, as compared to years past. Tighter lending margins are squeezing profitability while tougher economic conditions are bringing down asset quality. Competition is intensifying domestically and across the region as banks increasingly try to attract competitors’ customers. Toward this end, technology has become essential, not only to improve customer experiences, but to improve efficiency and effectiveness as well. Banks that struggle with these issues will likely face potential buyers, as the trend of consolidation continues.
 

Bank of China (BOC) has always been the most international of China’s big banks. As conditions at home become more challenging, the bank is taking advantage of its international background to strengthen its presence in overseas markets and expand its trade finance and M&A advising services. BOC has overseas branches in 46 countries and regions, accounting for 27% of total assets. Through this network, the bank is facilitating the investments of China’s largest companies, including China National Petroleum Corporation (CNPC) and China National Offshore Oil Corporation, as they expand west as part of the country’s Belt and Road initiative. Last year, BOC extended $ 28.6 billion in loans and other credits to such projects and it plans to lend a total of approximately $87.0 billion. BOC is also expanding south, with the help of its Hong Kong subsidiary. Last May, BOC announced a plan to shift its assets in some Asean countries to BOCHK, effectively turning the subsidiary into a regional bank for Southeast Asia.

In the seven years since it opened its doors, Kabul-based Ghazanfar Bank has established itself as one of Afghanistan’s most innovative and successful financial institutions. The bank has strong product lines in both conventional and Islamic banking, and offers extensive online and mobile banking service.  Recently, Ghazanfar launched a pension plan program and partnered with Mastercard to offer 3D Secure internet transactions. As a result of these and other services, fee and commission-income income is rising rapidly, up 33% last year and accounting for more than a quarter of total net income.

Ravinder Singh Yadav, chairman of the Board

www.ghazanfarbank.com

Ameriabank increased its assets by almost 30% last year to surpass the $1 billion mark, an industrywide milestone. The bank accomplished this despite lower economic growth nationally and deteriorating asset quality within the industry. Innovation and transparency were key elements in Ameriabank’s success amid these challenging conditions. The bank last year introduced new technology to greatly expand the payment and service capabilities of its internet and mobile banking, and earlier this year, the bank attracted historic investment deals with foreign financial organizations. The success in doing so bodes well for the bank’s management team, which has expressed interest in listing on an international capital market soon.

Artak Hanesyan, chairman of the Management Board-General Director

www.ameriabank.am

The slowdown in China and resulting drop in commodity prices is dampening the high growth Australian banks have enjoyed in recent years. The country is relying more on its domestic service sector to drive growth, a healthy development but one which will likely mean slower growth for the country’s banks. Westpac, Australia’s second most profitable bank, is responding to the challenging environment by improving its asset quality while seeking out opportunities in insurance, wealth management, and SME lending. The bank also plans to expand its digital product line and strengthen its presence across Asia.

Brian Hartzer, CEO

www.westpac.com.au

Dropping oil prices have dragged down Azerbaijan’s economic growth and the value of its currency, the manat. While the resulting capital outflows have shaken the banking industry, Pasha has benefited from its traditional focus on non-oil industries and continued to perform well. The bank’s net operating profit more than doubled last year, but the bank greatly increased its provisioning for bad loans, a conservative approach resulting in lower final net profit. “Pasha Bank still has a sound market position and strong capital buffer, which could provide protection against tough market conditions,” wrote S&P in a February ratings update.

Taleh Kazimov, CEO

www.pashabank.az

Dhaka-based City Bank has a stated goal of becoming a “financial supermarket” and has continually expanded its product lines toward that end. The bank offers an extensive branch and ATM network, a wide range of Visa, Mastercard, and American Express credit card products, an international money transfer network, and wealth management and private banking services for its high-net-worth clients. Last year the bank improved its popular CityTouch online banking platform and introduced CityQ, an online program to reduce waiting times at banks. As a result of all these efforts, City Bank saw its 2015 operating profit rise more quickly than any of Bangladesh’s other top ten banks.

Sohail Reza Khaled Hussain, CEO and managing director

www.thecitybank.com

Growth in oil-rich Brunei flat-lined last year as fuel prices fell. Baiduri Bank pushed its net profit up by 7.2%, however, by improving its service and expanding its product line. Among the big moves, the bank upgraded security features for its online banking and launched its “café banking” concept, which offers twice as much space and staff as a traditional branch bank in a more casual environment. The bank also expanded its retail network by purchasing the domestic branches of Singapore-based United Overseas Bank and launched its own securities and trading subsidiary to access foreign capital markets and prepare for the eventual launch of Brunei’s own stock exchange.

Pierre Imhof, CEO

www.baiduri.com

Cambodia grew by around 7% last year and is likely to do the same in 2016, according to World Bank estimates. ABA Bank capitalized on this growth last year to more than double its net profit. To keep up that momentum, the bank is expanding online services, adding five new branches to its network of 38, and offering innovative products such as its cardless ATM withdrawal, which will facilitate remittance transactions. ABA boosted its capital base with help from the National Bank of Canada, which owns a stake in the bank, and sought out other international partnerships with China-based Union Pay and online hotel reservation company Booking.com, among others.

Askhat Azhikhanov, CEO

www.ababank.com

The Industrial Commercial Bank of China (ICBC) is the world’s largest bank by customer deposits and loans and second largest by market capitalization. It leads its domestic peers across most measures, including largest retail bank, wholesale bank, electronic bank, and issuer of credit cards, among others. The bank’s tremendous size has not inhibited its innovation, however. In the first three quarters of 2015, the bank’s R&D team received 31 new patents and now boasts 388 in total. Recently, the bank utilized its strong technological capability to centralize its data processing and accelerate the speed of its transactions. 

Jiang Jiangqing, chairman

www.icbc.com.cn

Operating in Hong Kong for almost a century, Bank of East Asia has built on its commitment to and deep knowledge of its home market. BEA is adding technological capability to on those traditional strengths to bring more efficiency to its operations and convenience to its customers. The bank launched 20 digital branches last year and has plans to digitalize half of its HK branches by the end of 2016. The bank also saw gains in its personal banking and wealth management business, with much of the demand for such products coming from its extensive network in Mainland China.

David Kwok-po Li, CEO and chairman

www.hkbea.com

Government-owned State Bank of India (SBI) is by far the country’s largest commercial bank – in terms of assets, deposits, profit, branches, customers, and employees. Last year, the bank built on its tremendous success in traditional banking by significantly expanding its point-of-sale network (POS) and boosting its mobile banking business to claim an industry-leading market share. In March, SBI further demonstrated its industry leadership by being the first among its peers to implement a marginal cost of funds method of calculating interest rates. The move will lower interest rates for customers and bring more flexibility to respond to market conditions. 

Arundhati Bhattacharya, chairman

www.sbi.co.in

Unlike most state-owned banks in the world, Bank Rakyat Indonesia has built its success on small-scale loans and microfinancing. Such loans require more sophisticated risk management, and BRI’s expertise in this area has helped the bank avoid many of the credit quality issues plaguing its peers. Against a challenging backdrop, BRI posted a 5% gain in net profit in 2015 and only a slight increase in its nonperforming loan ratio from 1.69% to 2.02%. The bank is continuing its focus on micro-lending with its recently introduced “Floating Bank” concept, which services the many residents of Indonesia’s islands through the use of an air-conditioned bank branch housed on a boat.

Asmawi Syam, president director

www.bri.co.id

Japan’s tight monetary conditions put pressure on bank margins, a situation which has only worsened since the central bank implemented negative interest rates in February. Against this backdrop, Sumitomo Mitsui Financial Group, the country’s second largest bank by market value, is focusing on its overseas markets to compensate for lower growth at home. In the final quarter of calendar year, this approach yielded profit growth of 17%. Building on this international growth, the bank announced in March that it would enhance its Global Business Promotion Framework by forming specialized groups to focus on business segments across its global network.

Koichi Miyata, President

www.smfg.co.jp

In the past year, Kazakhstan’s economy struggled and its currency tumbled as worldwide oil fell. Banks are suffering through rapid rises in non-performing loans, while navigating currency risks and new regulations. In response to these conditions, the shareholders of Eurasian bank demonstrated confidence in their bank by injecting KZT 6 billion into Eurobank in November, increasing capital adequacy and better preparing the bank for potential losses. In a December review, S&P writes, “The stable outlook on Eurasian Bank reflects our expectation that the bank’s experienced management team will be able to mitigate the pressure on the bank’s financial results given the depressed economic environment and constrained system-wide funding in the Kazakh banking sector in the next 12-18 months.”

Michael Eggleton, CEO

www.eubank.kz

Demir Kyrgyz International Bank is building on its reputation on as an industry pioneer by continuing to expand despite the industry’s tough operating environment. Last year, the bank increased its corporate and SME customer base and retail customer base by 16% and 42% respectively. More impressively, the bank capitalized on its international reputation and strong payment capabilities to capture market shares of 32% in international Visa cards, 41% for international ATMs, 50% for POS transactions, and 58% of POS terminals accepting international cards.

L. Sevki Sarilar, general manager

www.demirbank.kg

The economic slowdown in China has greatly impacted the island of Macau, which depends on Mainland tourists and their fondness for casinos to drive growth. The economy contracted last year and property prices fell. Banks are feeling the pain of his contraction, and asset quality will continue to suffer. ICBC Macao is well-positioned to weather the storm by building on its parent company’s international experience and technological capabilities while remaining focused on servicing its domestic clients. Last year, ICBC Macau’s after-tax profit rose around 25% while its NPL ratio remained low at 0.06%.

Wu Long, CEO and vice chairman

www.icbc.com.mo

Maybank is Malaysia’s largest bank by market capitalization and assets and boasts one of the most extensive banking networks in Southeast Asia. The bank’s profits grew at a compounded annual rate of 11.2% over the past five years, and the bank now has branches in all ten Asean countries, opening last year a branch in the Chinese city of Kunming and launching operations in Myanmar. Maybank has been particularly active and innovative in Islamic finance, and such products now account for more than half of its domestic loan portfolio.

Abdul Farid Alias, CEO

www.maybank.com

After years of rapid growth, Mongolia’s economy slowed significantly last year as demand in China cooled and global commodity prices fell. The banks, which had expanded lending to capitalize on the growth, are now facing problems with loan quality. XacBank’s strong management team, diverse lending portfolio, and commitment to risk management is putting the bank in better position than its peers to continue performing well. The bank also benefits from the participation of foreign investors, including the National Bank of Canada, which purchased a 10.5% stake in the bank in December, the first such investment by a foreign commercial bank in the Mongolian banking industry.

Bold Magvan, CEO

www.xacbank.mn

The political and economic opening of Myanmar is generating excitement across the region and around the world, and investors across all industries are watching closely. CB Bank has capitalized on the opportunities presented by that opening to establish itself as the country’s most innovative domestic bank. CB Bank was the first to offer internet and mobile banking service and accept Visa and Mastercard at its ATMs and boasts the largest national POS network. Last year, the bank introduced its own card service allowing unsecured credit lines to qualified customers, a first for the industry. In response to the launch of the domestic stock market in December, CB Bank opened a securities subsidiary, greatly expanding the scope of services it offers.

Khin Muang Aye, chairman

www.cbbank.com.mm

Nepal ratified a constitution last year after more than a decade of turmoil and debate. The celebration didn’t last long, however, as trade disruptions pushed down trade and pushed up prices for basic imported supplies. Since that informal blockade faded earlier this year, economic growth is up and banks are seeing rapid rises in lending. Nepal Bank, the country’s oldest financial institution, is well placed to benefit from the growth. The bank almost tripled its quarterly profit year-on-year in the quarter ending in January, while reducing its non-performing loan (NPL) ratio from 4.62% to 3.85%.

Devendra Pratap Shah, CEO

www.nepalbank.com.np

New Zealand’s economy has grown steadily in recent years, and the country’s well-run banks have benefited. Westpac New Zealand has used technology to capitalize on the favorable economic conditions through programs such as its digital housing applications, which increased by 58% in the second half of 2015, and its 24/7 banking facilities, now available at 49% of its branch banks. As economic conditions soften amid falling dairy prices and higher household debt, this move toward digital banking will complement the bank’s strong balance sheet to enable Westpac to continue performing well.

David McLean, CEO

www.westpac.co.nz

In business since 1863, Standard Chartered Bank of Pakistan has capitalized on its depth of experience, its familiarity with international best practices, and its commitment to quality service and innovation to grow into one of Standard Chartered’s most successful national franchises. The bank has pioneered Islamic finance across the region and is the only bank in Pakistan offering a shariah-compliant credit card. An early investor in technology, Standard Chartered now conducts 68% of its transactions through digital channels. It opened its first digital branch bank last year. The bank has also launched a number of wealth management, trade finance, and cash management products.

Mohsin Ali Nathani, CEO

www.sc.com/pk

BDO boasts the top market share across almost every measure – assets, loans, deposits, total capital, and net income – and leads the industry across several segments, including private banking, investment banking, remittance, and credit cards. The bank looks to maintain that lead with a number of big moves in the past year, including the July 2015 purchase of the country’s largest rural bank and its acquisition of full control of a leading insurance company. BDO also opened an office in Beijing and signed agreements to cooperate with Japanese and Singaporean partners, further boosting its international profile as well as its convenience for foreign investors in the Philippines.

Nestor V. Tan, CEO

www.bdo.com.ph

Singapore’s three biggest bank consistently rank among the best in the world. The past year has been rockier than most, however, as trade and growth slowed in Singapore and around the region. On March 31, Moody’s downgraded the ratings outlook for Singapore’s big banks to negative. Despite the challenges, OCBC posted record after-tax core profit of S$3.90 billion ($2.9 billion) last year, up 13% from 2014, with fees from its wealth management, brokerage, and fund management making particularly strong contributions. OCBC is keeping up the momentum this year by being the first bank in Singapore to introduce an integrated wealth management app as well as a banking app for the Apple Watch.

Samuel Tsien, CEO

www.ocbc.com

Declining interest margins, higher household debt, and stricter regulations have pushed up the pressure on South Korea’s already highly competitive banking sector. The intense environment has driven many Korean banks to look overseas for further growth. South Korea’s fourth largest lender, Hana Bank, strengthened its domestic and international position last year by completing its merger with the Korean Exchange Bank (KEB). The newly formed entity, KEB Hana Bank, instantly became the largest Korean bank by assets and by international network, putting KEB Hana Bank and its parent company Hana Financial in good position for continued growth.

Young-joo Ham, president and CEO

www.hanabank.com

Commercial Bank of Ceylon continues to grow quickly and across varying segments even as Sri Lanka’s economy slows and margins narrow across the industry. Commercial Bank ranks first among Sri Lanka’s private banks in terms of profit, deposits, and loans, and enjoys the highest market capitalization in the industry. The bank also leads the industry in online banking and saw its SME portfolio grow 53% in value through the first nine months of 2015. Recent technological upgrades will simplify and protect ATM and other transactions at home, while investments in the Maldives and Myanmar will facilitate the bank’s success abroad.

Jegan Durairatnam, CEO and managing director

www.combank.net

CTBC leads the market in the number of its credit cards, ATM transactions, and mobile and internet banking customers, and the bank brought many new products to the market last year, including a finger-print identification system to replace ATM cards and a special card to facilitate credit-to-cash transactions for traditionally cash-only businesses. CTBC is building on its success to vastly expand its geographical reach as well as the range of services it offers. In recent months, the bank invested in financial companies at home in Taiwan as well as in Japan, Thailand, and Mainland China while greatly expanding its wealth management and investment banking product lines.

Chao China Tung, chairman

www.ctbcbank.com

Hampered by a decline in exports and political volatility, Thailand’s economy has struggled over the past couple years. Siam Commercial Bank, Thailand’s largest bank by market capitalization, is taking steps to move past the slowdown, such as writing off loans last year from two of its largest corporate clients, one of several moves that dragged profit down year-on-year at the bank for the first time since 2009. As a result, the bank is well-prepared to build on its traditional strengths in its retail business, mortgage lending, and asset management as well as newly implemented digital channels to gain regain its momentum going forward.

Yol Phokasub, president

www.scb.co.th

Uzbekistan has a more diverse economy than many of its neighbors, and for that reason, the country has avoided some of the economic pain resulting from dropping commodity prices. The IMF predicted last fall that the Central Asian economy to grow by about 7.0% this year. Asia Alliance Bank has benefited from the favorable climate domestically while also reaching out to foreign partners and facilitating trade financing to become the country’s most progressive bank.

Ikram Abdukakhorov, chairman

www.aab.uz

Vietnam is one of the few emerging markets generating excitement among investors. While growth hit 6.7% last year, however, the banks continue to struggle with asset quality issues. In response, the central bank has pushed for more direct involvement in banks and consolidation within the industry. As part of that push, Sacombank merged with Southern Bank last fall to form the nation’s fifth largest bank. As part of the deal, the central bank took some control from the previously private Sacombank. While the increased government involvement could ward off some credit risks, Sacombank may struggle it maintain the progressive approach which has contributed to its success. The bank’s net profit fell by 48% last year.

Phan Huy Khang, CEO

www.sacombank.com

The Middle East is facing a period of slower economic growth as a result of lower oil prices, but banks across the region have continued to perform well by controlling costs and adhering to conservative lending policies. While government deposits have been drawn down in many cases, this has been offset by a rise in private-sector deposits. A major credit squeeze has been avoided.

Governments in the region are likely to be highly supportive of local banks, analysts say. Moody’s Investors Service says the outlook is stable for the UAE’s banking system, owing to its resilient capital and liquidity buffers, coupled with ongoing profitability. However, the ratings agency cautions that the softening economy will weaken operating conditions and result in subdued credit growth.

Fitch Ratings forecasts slower economic growth for most Gulf Cooperation Council member countries in 2016. It says 16% of ratings assigned to GCC banks are on negative outlook, with the bulk of these concentrated in Saudi Arabia. As the government draws down foreign assets to finance its deficit, the state’s ability to support banks may come under pressure.
 

Arab Bank’s global network of more than 600 branches on five continents is the most extensive of any bank in the Arab world. Founded in 1930, Arab Bank is the oldest financial institution in the region, with deep knowledge and relationships that enable it to serve niche markets in the Middle East and North Africa (MENA) better than any other bank.

As a result of its diversification, Arab Bank receives 75% of its revenue from outside of its home base of Jordan. Its global network of treasury centers provides corporations with a wide range of products, including cash management, foreign exchange and trade finance. The bank is a market maker in MENA currencies and offers hedging solutions such as swaps, options and hybrid instruments to cover currency exposures. It also offers interest-rate hedging solutions and capital markets services. With $49 billion in assets, Arab Bank has subsidiaries in Switzerland and Australia and is present in major financial centers worldwide. In 2007, it established Europe Arab Bank, a London-based subsidiary. The bank is well positioned to help international companies access Middle Eastern markets and to support the needs of local companies as they expand abroad.

Nemeh Sabbagh, CEO

www.arabbank.com

Ahli United Bank, a Bahrain-based regional bank with $34 billion in assets and a network of 136 branches, maintained its strong growth in 2015, with record earnings of $537 million, an increase of 11.3% from a year earlier. AUB’s return on average equity rose to 16%. In October 2015, the bank received approval in principle to set up a Category 1 bank in the Dubai International Financial Centre, which would enable it to cover the UAE market and tap regional cross-border trade flows. In addition to Bahrain, AUB already operates in Kuwait, Egypt, Iraq, Oman and Libya, and it has a UK subsidiary. Last October it acquired the remaining 50% stake in Legal & General Gulf, which offers conventional and shariah-compliant life insurance in Bahrain and Kuwait.

Adel El-Labban, group CEO and managing director

www.ahliunited.com

Commercial International Bank, Egypt’s largest private-sector bank, has 187 branches and a leading market share in loans and deposits. It is also the largest listed corporation in Egypt. The bank’s earnings rose 14.3% last year, boosted by an improvement in net interest margins. Consolidated return on average equity was 33.4%. CIB closed the acquisition of Citi’s Egyptian retail portfolio in the fourth quarter of 2015. Meanwhile, the bank increased its nonperforming-loan (NPL) coverage ratio to 188% in the face of deterioration in key business sectors.

Hisham Ezz-Al Arab, chairman and managing director

www.cibeg.com

Tehran-based Bank Saderat Iran has the largest banking network in the country, with about 3,000 branches and an estimated $60 billion in assets. International sanctions, including banking restrictions, on Iran ended in January under a deal in which Iran would curb its nuclear program. However, a US ban on dollar trading and a freeze on US banks trading with Iran remain in place. Bank Saderat Iran has eight branches and a regional office in the United Arab Emirates that handle trade with Iran. Lebanon is another focus of the bank’s activities, with five branches and a regional office. Altogether, Bank Saderat has 28 international offices in 12 countries.

Esmaeel Lalehgani, managing director & vice chairman

www.bsi.ir

Bank of Baghdad, a subsidiary of Kuwait-based Burgan Bank, is one of the largest private commercial banks in Iraq, with a nationwide network of 40 branches. It was the first bank in Iraq to introduce online and mobile banking services. Bank of Baghdad has 20 subsidiaries in Iraq that are involved in such industries as insurance, construction materials, food and clothing. It has been listed on the Iraq Stock Exchange since 2004 and is one of the most actively traded companies on the exchange.

Faisal Al Haimus, CEO

www.bankofbaghdad.com

Bank Hapoalim, Israel’s largest and highest-rated bank, has a network of 250 retail branches. It has increased its market share in commercial banking from 25% to more than 35% in the past six years. The bank has established Poalim Hi-Tech on Tel Aviv’s Rothschild Boulevard, the center of Israel’s start-up sector, to serve the specialized financial needs of high-tech companies. Bank Hapoalim’s strategy is to focus on fast-growing and profitable sectors of the economy while significantly increasing operating efficiency.

Zion Kenan, president and CEO

www.bankhapoalim.com

Amman-based Arab Bank has managed to grow its business and avoid the risks associated with regional uprisings. During 2015, the group closed the financing of six solar power projects in Jordan, in collaboration with the International Finance Corporation. The bank also continued to support projects across the region. It was a main lender in the expansion project for Egypt’s Suez Canal. At the same time, Arab Bank has focused on providing financial services to small and medium-size enterprises. Corporations are served with online cash management and trade finance platforms.

Nemeh Sabbagh, CEO

www.arabbank.com

National Bank of Kuwait has long been the market leader in its home market, where it accounts for nearly half of the banking industry’s profits. The bank also has a strong presence in most regional markets. It remains among the highest-rated banks in the Middle East and made Global Finance’s list of the 50 safest banks in the world in each of the last ten years. NBK is a growing presence in many of the world’s top financial centers—in the final stages of upgrading its representative office in Shanghai into a branch. NBK Capital is a leading investment firm in the Middle East and North Africa.

Isam Jasem Al Sager, group CEO

www.nbk.com

Bank Audi, the leading bank in Lebanon in terms of assets, deposits, loans and equity, is a regional financial group with a presence in 12 countries. The bank’s earnings rose more than 15% last year, with entities outside of Lebanon contributing to 63% of this growth. Bank Audi’s main growth markets outside of Lebanon are Egypt and Turkey. It established Odeabank in Turkey from scratch in 2012, and it is now a top-10 bank in that country, with $11 billion in assets. A leader in private banking, Bank Audi formed a partnership with London-based Crossbridge Capital to create a specialized wealth management platform.

Samir Hanna, group CEO

www.bankaudi.com.lb

BankMuscat complements its network of 139 domestic branches with a growing international network. In addition to branches in Saudi Arabia and Kuwait, the bank has representative offices in the UAE and Singapore. BankMuscat also owns 49% of BMI Bank in Bahrain, and 43% of Mangal Keshav, an Indian securities firm. It is also partners with the International Finance Corporation and Nomura in Pakistan’s Silkbank. BankMuscat’s Meethaq Islamic banking unit is the largest in Oman. BankMuscat had a 7.5% increase in earnings last year, and a capital adequacy ratio of 16.1%

AbdulRazak Ali Issa, CEO

www.bankmuskat.com

Bank of Palestine, the largest Palestinian bank, has the most widespread branch network in Palestine, with 57 branches serving 750,000 customers. The bank’s profits rose 7.3% last year, and its assets increased 15% to $2.8 billion. Loans rose 21% from a year earlier, and the NPL ratio dipped to 1.7% from 2.2%. Bank of Palestine opened a representative office at the Dubai International Financial Centre in 2015, and will soon open another such office in Chile, which is home to 500,000 people of Palestinian origin.

Hashim Shawa, chairman and general manager

www.bankofpalestine.com

Qatar National Bank, the biggest bank in Qatar, was ranked by Global Finance as one of the 50 safest banks in the world in 2015. It is 50% owned by the Qatar Investment Authority, the country’s sovereign wealth fund, and it has an extensive presence in the Middle East and Africa. It holds a 20% stake in Ecobank, a leading pan-African bank. Last December, QNB agreed to acquire Turkey’s Finansbank from National Bank of Greece. Earlier in 2015, QNB opened a representative office in Ho Chi Minh City, Vietnam, and will soon open a branch in Saudi Arabia. QNB’s earnings rose 8% last year to $3.1 billion, and its assets increased 11% to $148 billion.

Ali Ahmed Al-Kuwari, group CEO

www.qnb.com.qa

Samba Financial Group was the first bank in Saudi Arabia to introduce private banking, ATMs, charge cards, derivatives, online trading and many other financial products and services. Its Samba Capital subsidiary has one of the largest teams of investment bankers in the country. It is the leading equity capital market franchise, and the leading financial adviser on mergers and acquisitions. Samba Capital is also an active arranger, lead manager and placement agent for sukuk, or Islamic bonds. It is one of the largest asset managers in the kingdom. Altogether, Samba’s earnings rose 4.1% last year against a weakening economic backdrop. Assets grew by 8.2%.

Eisa Al-Eisa, chairman

www.samba.com

Abu Dhabi Commercial Bank’s earnings rose 17% to a record $1.35 billion in 2015. The bank avoided the negative effects of declining oil prices and tightening credit conditions by reducing its exposure to corporate revolving credit and ending certain stressed lending relationships. The bank’s sharp focus on serving the UAE, where the economy remains strong and diversified, was also a factor. ADCB is 58% owned by the government of Abu Dhabi through the Abu Dhabi Investment Council. The bank’s return on average equity for 2015 was an industry-leading 20.3%.

Ala’a Eraiqat, group CEO

www.adcb.com

Arab Bank Yemen, part of Jordan-based Arab Bank Group, has been operating in Yemen, on the southern Arabian Peninsula, for more than four decades. The bank has focused on international trade and infrastructure development. Based in Sana’a, it has a network of 10 branches and serves retail, business and corporate customers. It also offers private banking services for wealthy individuals. Attacks by rebels on Yemen’s liquid natural gas  supplies have worsened an already severe economic crisis.

Omar Al-Sous, area manager

www.arabbank.com

Africa is a patchwork of countries at various stages of development. Its once-bright economic outlook dimmed last year, as oil and commodity prices tumbled and the economy of China, its main trading partner and investor, also disappointed. To top it off, Barclays announced plans to sell its 100-year-old African business. The British bank made it clear that it had not lost faith in Africa’s potential, but that new regulations make it more expensive from a capital point of view to hold stakes in other banks.

The International Monetary Fund forecasts 3.75% economic growth for sub-Saharan Africa this year, the lowest rate of growth since 2009. There are signs, however, that energy and commodity prices may have found a bottom. A growing middle class is creating expanding consumer markets and opportunities for bankers. Sub-Saharan Africa already leads the world in mobile money accounts, according to the World Bank. The future could be rewarding for those willing to invest for the long term.
 

Africa’s largest bank by assets, Standard also does business under the Stanbic name. Based in South Africa, it is the leading liquidity provider for African currencies, operating in 20 countries across the continent, and another dozen around the world—with a total of 1,221 branches and 8,815 ATMs. Normalized earnings for 2015 rose 34% to $1.37 billion; assets increased 4% last year to $128 billion.

While others are cutting back, Standard remains focused on its growth in Africa, introducing innovative products such as contactless cards and mobile payment solutions. Standard partnered with China’s leading mobile-payment provider, WeChat Wallet, which will use the bank’s pan-African infrastructure to serve the continent. The bank also offers insurance and new risk products.

Last year the bank disposed of a controlling interest in its British unit to Industrial and Commercial Bank of China, which also holds a 20% stake in the South African bank. Standard Bank expects to generate significant benefits from its strategic partnership with ICBC, and proceeds from the UK transaction will be used to strengthen its operations on the African continent.

Ben Kruger and Sim Tshabalala, group CEOs (joint)

www.standardbank.com

French bank Société Générale was one of the first privately owned international banks to establish a subsidiary in Algeria, where state-owned institutions account for the majority of the banking business. Société Générale Algérie has 85 branches in the country’s main economic zones, including 10 business centers for corporate clients. The bank’s credit outstanding to corporations increased by 35% last year. Its highly integrated organization enables the bank to maximize the use of its talent in specialized areas to support corporate and financial institution clients with efficient, customized services.

Eric Wormser, CEO

www.societegenerale.dz

Standard Bank Angola serves local and international clients through its network of 28 branches in Angola. As part of South Africa’s Standard Bank Group, it provides a range of cross-border solutions supported by its global platforms and network of experts. The Angolan bank is also a full-service investment bank. Although petroleum exports account for 95% of Angola’s international trade, Standard Bank conducts less than half its business with the oil industry.

Pedro Coelho, CEO

www.standardbank.co.ao

Ecobank Benin has continued to improve its performance, despite the country’s economic slowdown and relatively weak competitiveness. The bank’s deposit base has been growing, and it makes sure that it has enough deposits to back every loan. Increased regulation has had an adverse effect on the bank’s interest margins and commissions. Therefore, Ecobank Benin decided to focus on the value chain of local corporates, and the strategy seems to be paying off.

Roger Dah-Achinanon, CEO

www.ecobank.com

Stanbic Bank Botswana is a subsidiary of South Africa-based Standard Bank. It is one of the largest suppliers of foreign exchange to the market—and one of the country’s fastest-growing banks. Stanbic Botswana facilitates cross-border transactions and offers advice on exchange controls. It has one of the largest investment banking teams in Botswana, which enables it to offer additional foreign exchange trading and currency-risk management services.

Leina Gabaraane, CEO

www.stanbicbank.co.bw

Ecobank Burkina Faso has earned a high return on equity over the past few years in this French-speaking country. The bank focuses on providing small loans to cotton growers, as well as offering mobile banking services through Airtel Mobile. Established in 1996, the bank has a network of 77 branches and more than 250,000 customers. Burkina Faso is the largest producer of cotton in sub-Saharan Africa.

Cheick Travaly, managing director

www.ecobank.com

Ecobank Cameroon has shown strong gains in earnings in recent years by focusing on delivering improved customer service through alternative banking channels, as well as new branches. The bank opened two new branches last year, bringing the total to 35. It also installed 12 new ATMs and introduced a mobile wallet through a partnership with Orange Cameroon. Another goal is to rapidly increase the number of small and medium-size enterprises it serves.

Moustapha Fall, managing director

www.ecobank.com

Société Générale operates in 17 African countries. Its subsidiary in Côte d’Ivoire is the largest bank in the country, with 67 branches. The bank provides financing for large, state-owned companies as well as small and midsize enterprises. It has a market share of 25% in loans and deposits for individual clients. The bank offers a broad range of products to all customer segments.

Hubert de Saint Jean, CEO

www.sgbci.ci

Trust Merchant Bank is the first and only commercial bank to offer full-service mobile banking in the Congo. Its network of 85 branches is nearly twice that of its nearest competitor. The bank has a 20% market share of active bank accounts in the nation. It provides salary and invoice payment services to remote areas, with staff traveling even to the remotest parts of the country to provide service.

Oliver Meisenberg, CEO

www.tmb.cd

Red Sea Trade and Industry Bank, or BCIMR, according to its French initials, has a majority share of the banking system in Djibouti. The subsidiary of Bred Banque Populaire, or BPCE Group, could soon be getting some competition from Chinese banks, which recently won the right to operate in the country. China also is expected to site a naval base in the strategically located country and is building a $4 billion railway linking Djibouti with Ethiopia.

Jean-Pierre Gianotti, CEO

www.bcimr.dj

Commercial Bank of Ethiopia, the country’s largest bank, has more than 1,000 branches and a majority of the country’s bank deposits. The government-owned bank has hired China State Construction Engineering to build its new, 46-story headquarters, which will be East Africa’s tallest building. Government spending is the key driver of Ethiopia’s economy, which grew by 8.7% last year.

Bekalu Zeleke, president

www.combanketh.et

Standard Chartered has been operating in Gambia since 1894. The bank has five branches and 10 ATMs. Gambia, an impoverished state hugging the banks of the Gambia River, declared itself an Islamic republic last December, hoping to attract investments from the Middle East. Remittances from Gambians living abroad have surpassed peanuts and tourism as the country’s main source of foreign exchange. Standard Chartered derives about 70% of its local earnings from foreign exchange.

Albert Saltson, CEO

www.standardchartered.com/gm

Accra-based GCB Bank is one of the largest banks in Ghana, with 160 branches spread across the country. Formerly known as Ghana Commercial Bank, GCB is well capitalized and has invested heavily in technology. Growth in Ghana’s commodity-dependent economy slowed from 8% in 2012 to 3.5% last year. The country is struggling with debt, inflation and a depreciating currency.

Simon Dornoo, managing director

www.gcb.com.gh

Société Générale is one of Guinea’s leading banks, with a 20% market share. Based in the capital, Conakry, it has 19 branches covering the country’s four regions. The bank serves mining companies and large international companies. It offers cash management and treasury services. Mineral-rich Guinea has the world’s largest reserves of bauxite. Economic growth has slowed sharply in recent years—after hitting 2.3% GDP in 2013 it slowed to 0.6% in 2014—in part because of the Ebola virus outbreak.

Marc Leguevaques, CEO

www.societegenerale.com

After restructuring in 2014, Equity Bank’s parent group posted a 12% growth in earnings for 2015, as well as a 24% increase in its balance sheet, driven by a 23% increase in customer deposits. This supported a 26% increase in the net loan book, including a 72% increase in loans to small and medium-size enterprises. The group, which has nearly 10 million customers in six East African countries, says it is committed to a long-term strategy of regional expansion to take advantage of economic integration and growing intra-Africa trade.

James Mwangi, CEO and managing director

www.equitybankgroup.com

Bank of Africa Group is majority-owned by BMCE Bank, the second-largest private bank in Morocco, and has operations in 18 sub-Saharan countries. Bank of Africa–Madagascar has 65 branches in the country and accounts for about a third of Madagascar’s lending. The IMF expects growth to pick up to more than 4% this year, owing to a recovery in tourism, which was affected by Air Madagascar’s operational problems in 2015.

René Formey de Saint Louvent, managing director

www.boa.mg

Bank of Africa maintains its group headquarters in Bamako, Mali’s capital, where it was founded in 1982, and has 52 branches across the country, plus a business center. GDP growth slowed to 4.9% last year from 7.2% in 2014., but Mali’s Economy and Finance Ministry expects 6% growth in real GDP this year, due to an anticipated increase in cotton and gold exports.

Bouchaib Fachar, director general

www.boamali.com

This subsidiary of Standard Bank Group has been serving Mauritius since 2001. The bank’s focus is on corporate and investment banking and wealth management. An offshore financial center, Mauritius’s upper-middle-income economy continues to grow at a moderate pace. The IMF said recently, however, that the nation faces spillover risks from links between large offshore activities and the banking system.

Lakshman Bheenick, CEO

www.standardbank.mu

Casablanca-based Attijariwafa Bank, the leading bank in Morocco, operates an extensive network of 3,300 branches across 14 African countries and another 10 countries in Europe and the Middle East. It is planning to bid for Barclays’s Egyptian operations. Attijariwafa Bank is 48% owned by the Moroccan royal family holding company, SNI.

Mohamed El Kettani, CEO and chairman

www.attijariwafabank.com

Millennium bim is one of Mozambique’s largest banks, with a nationwide network of 169 branches, including 43 in rural areas. The Millennium (Z) mobile-banking service is expanding rapidly in rural areas of Mozambique. The service handled seven million transactions a month last year, up from 4.3 million monthly in 2014. The bank added more than 1,000 new point-of-sale systems in 2015.

Manuel Marecos Duarte, CEO

www.millenniumbim.co.mz

Standard Bank Namibia has been operating for more than 100 years. Its 51 branches and agencies comprise a wide-ranging network. Namibia’s economy is closely linked to that of neighboring South Africa. The two countries share electricity supply constraints, low prices for mineral exports, and drought-affected agricultural production. The Bank of Namibia expects real GDP growth of 4.3% this year and 5.9% in 2017.

Junius Mungunda, CEO

www.standardbank.com.na

FirstBank, the country’s largest bank by assets, has more than 750 branches and agencies. It has operated in the country since 1894. The bank said it likely would report a decline in earnings for 2015 on the recognition of impairment charges following a review of the loan portfolio. Nigeria’s economy has been hit hard by the oil price slump, foreign exchange restrictions that led to capital flight, and the ongoing conflict with Islamist militant group Boko Haram. The country is striving to cope with power shortages, import restrictions and a scarcity of dollars.

Adesola Kazeem Adeduntan, managing director and CEO

www.firstbanknigeria.com

Rwanda’s largest commercial bank by assets, Bank of Kigali has 75 branches in all parts of the country. Its earnings rose 12% in 2015, thanks mainly to growth in net interest income. The bank was the second company to list on the Rwanda Stock Exchange, with an initial public offering for a 45% stake in 2011. The government holds a 29.5% stake, and the Social Security Board holds 25.1%.

Diane Karusisi, CEO

www.bk.rw

Dakar-based SGBS has been operating in Senegal since 1962, and now has a network of 43 branches. It offers a broad range of products and services and is deeply involved in the country’s development. SGBS is one of the leading banks in Senegal for international trade finance and foreign exchange hedging solutions.

Yann de Nanteuil, CEO

www.societegenerale.com

Zenith Bank in Sierra Leone is a subsidiary of Lagos-based Zenith Bank, one of Nigeria’s largest banks, with subsidiaries in Ghana and Gambia as well. Zenith Bank is one of five Nigerian banks with operations in Sierra Leone. The country is attempting to restore economic growth, which was brought to a near standstill by the Ebola crisis.

George Meze, CEO

www.zenithbank.com

FirstRand Bank, one of the largest financial institutions in South Africa, managed a 9% rise in normalized earnings in the final six months of 2015, as growth in the economy slowed to a crawl. The bank plans to close some of its 716 branches and cut jobs at its retail-banking unit as more customers switch to digital banking and the economy continues to struggle. The unemployment rate is around 25% and GDP growth is forecast to slow to less than 1% this year, as the result of falling commodity prices and a severe drought.              

Sizwe Errol Nxasana, group CEO

www.firstrand.co.za

Ecobank Togo, based in Lomé, has 23 branches and a market share of approximately 25%. Togo hosts the headquarters of Ecobank Transnational, the parent company of the pan-African banking group, which operates in 30 African countries. In March the European Investment Bank joined the IFC’s risk-sharing facility with Ecobank, which is designed to increase lending to smaller businesses.

Didier Alexandre Correa, managing director

www.ecobank.com

BIAT, the largest private-sector bank in Tunisia, opened nine branches last year, bringing the total to 194. The bank also has an office in Libya. In addition to retail and commercial banking, BIAT offers capital markets services, insurance, brokerage and mutual funds. The bank has increased provisions to cover nonperforming loans.

Mohamed Agrebi, CEO

www.biat.com.tn

Stanbic Bank Uganda is the country’s largest bank by assets and market capitalization. Its network of 95 branches offer a wide range of services to individuals and businesses, including corporate and investment banking and custody services. Uganda’s economy grew by 6.5% last year but is expected to slow in 2016 because of low commodity prices and high interest rates. Yoweri Museveni won the presidential election in February, extending his 30-year rule.

Patrick Mweheire, CEO

www.stanbicbank.co.ug

Standard Chartered, one of the largest and most profitable banks in Zambia, has been operating in the country for 110 years. It now has 25 branches and a market share of about 20%. The bank continues to invest in new systems and digital platforms. Its mobile banking service is available on all three telecom networks in Zambia: Airtel, MTN and Zamtel.

Andrew Okai, CEO

www.standardchartered.com/zm

CBZ Bank, the largest bank in Zimbabwe, is part of CBZ Holdings, which is listed on the Zimbabwe Stock Exchange. The company’s nonbanking subsidiaries offer insurance and asset management products and services. CBZ Bank has an extensive branch network and a market share of 30% of deposits. It launched a new business-banking center in 2015.

Peter Zimunya, managing director

www.cbzbank.co.zw

Spreading Their Wings

The savviest midsize regional banks in the US are expanding from coast to coast and breaking into new industries. As the cost of compliance rises, midsize regional banks across the US are scrambling to grow economies of scale. The faster they grow, the easier it will be to pay their compliance teams while satisfying the Federal Reserve Board’s requirements to raise more capital. “With the economy growing at 2.5% to 3%, every banker has growth goals in the double digits,” Kevin Lavender, managing director for large corporate and specialized lending at Fifth Third Bank in Cincinnati, Ohio. “If we don’t find it in our own market, we’ll have to find it elsewhere.”

That’s why forward-thinking midsize regional banks are going super-regional by opening new offices in major cities from coast to coast, as Fifth Third and SunTrust of Atlanta, Georgia, have done over the past couple of years. Midsize banks that have grown by acquiring networks of community banks across state lines are consolidating them under a single charter, reducing head count, and otherwise bringing costs down. Others are finding all the growth they can handle at home, like Eastern Bank, which has a strong client base in Boston’s fast-growing commercial real estate industry.
 

Serving a healthy client base in Boston’s fast-growing commercial real estate industry, Eastern Bank was ranked by a JD Power survey as the best bank in New England. In 2015, Eastern’s net income rose 14%, to $62.6 million. The year ended with record levels of assets ($9.6 billion), deposits ($8.1 billion), and loans ($7.1 billion)—and the strongest credit quality in the bank’s 198-year history.

Richard Holbrook, CEO and chairman

www.easternbank.com

Based in Pittsburgh, Pennsylvania, PNC serves a super-regional client base spread out across banking entities in 19 states and the District of Columbia. PNC holds more than 30 regional presidents responsible for delivering treasury management, real estate finance and other corporate banking products to Main Street. In 2015, loans increased by 1%, deposits rose by 7%, and fee income was up 3%.

William S. Demchak, chairman, president and CEO

www.pnc.com

Over the past year, Cincinnati, Ohio-based Fifth Third Bancorp has sought double-digit growth rates by opening new offices in New York, Boston, Philadelphia, Washington, Dallas, Houston, and Los Angeles, says Kevin Lavender, managing director for large corporate and specialized lending at Fifth Third. While fulfilling its super-regional ambitions drove up expenses and net income was nearly flat in 2015, the bank still grew assets by 1.7%, to $140.1 billion.

Greg D. Carmichael, CEO

www.53.com

Kansas City, Missouri-based Commerce Bancshares thinks of itself as a “super community bank” with branches in five states, says Kevin Barth, the bank’s executive vice president for commercial lines of business. The bank spreads its risk by specializing in loans of under $25 million to a wide range of local industries, from food processing to healthcare. Assets rose 1.7%, to $20.7 billion in 2015, the 47th year the bank raised regular cash dividends.

David W. Kemper, chairman and CEO

www.commercebank.com

Based in Atlanta, SunTrust is expanding its investment banking and commercial banking arms nationwide. It is opening new branches across the country to serve its Southeast customers, who are spreading their wings in a wide range of industries, from financial technology to logistics to commercial real estate, says Mark Chancy, the bank’s wholesale banking executive. Assets were flat in 2015, at $190.8 billion. But net income rose 9.6% on growth in loans and deposits.

William H. Rogers Jr, chairman and CEO

www.suntrust.com

Known for its expertise in the energy industry, Dallas, Texas-based Comerica maintains a branch network across California and Texas. Total assets increased 3.9% in 2015, to $71.9 billion. Average loans increased by more than 4%, to $48.6 billion, mainly to companies to companies in commercial real estate, technology and life sciences, and mortgage banks. Small business loans grew by more than $100 million.

Ralph W. Babb Jr, chairman and CEO

www.comerica.com

Based in Salt Lake City, Utah, Zions Bancorp spent much of 2015 consolidating charters among the networks of community banks it has acquired to form a super-regional bank in Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington and Wyoming, says James Abbott, director of investor relations at Zions. Total assets grew 4% last year, to $60 billion. But net income fell 22%, mainly owing to the sale of $574 million in collateralized debt obligations.

Harris H. Simmons, CEO

www.zionsbancorporation.com

San Francisco-based First Republic boosted its assets by a formidable 21% in 2015, to $59 billion, partly thanks to a 6.7% increase in loans to commercial businesses. Specializing in bridge loans for private equity and venture capital in Silicon Valley, the bank has a legacy strength in private wealth management. First Republic has been run by management since a management buyout from Bank of America in 2010.

James H. Herbert II, chairman and CEO

www.firstrepublic.com