Top 50 Safest Commercial Banks 2019

With profits squeezed and fintech expanding, banks are re-evaluating their business models.

At the beginning of October, the Reserve Bank of Australia announced a quarter-point cut in the nation’s benchmark interest rate, to an all-time low of just 0.75%; and the administration pressed the banks to pass the cut along to clients. National Treasurer Josh Frydenberg told reporters in Sydney, “It is the government’s expectation that the banks will pass on this 25-basis-point rate cut in full.”

Yet within days, Australia’s four major banks made clear they would pass along only a portion of the cut to customers, essentially pocketing the rest, citing the enormous pressure of the current interest-rate environment. “Bank fundamentals are increasingly challenged with ultralow interest rates,” wrote Jonathan Mott, a banking analyst at UBS in Sydney, in a research note, adding that the research team expects “banks to rebase ROEs [returns on equity] to more realistic levels for an ultralow-rate environment.”

Factors forcing change on the sector include new regulatory requirements, heightened geopolitical uncertainty, rapidly developing technology and new financial-market players.

While the threshold for inclusion in the World’s Safest Commercial Banks has remained unchanged—a score of at least 17—our 2019 rankings reflect some shifts due to regulatory changes, resulting in a number of upgrades.

DNB Bank, Hang Seng Bank, BNP Paribas, Credit Agricole and BPCE have boosted debt levels in order to comply with total loss-absorbing capital and minimum for own funds and eligible-liabilities requirements, which benefit senior creditors. BPCE and Kookmin Bank are new entrants this year after fundamental improvements in their credit profiles resulted in upgrades, replacing Nationwide Building Society and Banco Santander Chile.

As banks face the possibility that slow growth and ultralow rates may be a “new normal,” they are beginning to reassess their business models, seeking to chart a course to 21st century profitability by harnessing digital capabilities and technology. Digital transformation will accelerate the evolution of the entities ranked among our Safest Commercial Banks.

Innovation has always been critical in finance, and banks are embracing this challenge with the development of digital platforms. Much of the early hype has focused on the retail segment, but commercial clients are also benefiting enormously from new digital tools that help with everything from compliance to tracking one’s carbon footprint along an entire supply chain. Analytical tools and algorithms that utilize artificial intelligence, cloud technology and blockchain are yielding new features that speed and facilitate the business of business.

For many institutions, this represents a tremendous shift; but the pace of technology in financial services is accelerating significantly. Consequently, banks continue to evaluate outsourcing of certain functions to increase efficiency and reduce costs. Because this complex issue carries many potential risks, as of September the European Banking Authority has in place revised guidelines for third-party outsourcing, designed to unify policy across jurisdictions and between different types of financial institutions.

Protecting customer data has always been a priority for the banking sector, especially in commercial banking. As digital platforms have developed, regulatory mandates have followed—such as the General Protection Data Regulation, which has been in effect in Europe since May 2018 and addresses data privacy. The European Commission introduced a second iteration of its Payment Services Directive, which established a framework for ensuring consumer-data protection while increasing participation and competition among payments companies within the European Union.

Our criteria exclude banks that are majority-owned by governments or receive sponsorship by their governments or regional bodies. The institutions included in our rankings operate in the same markets as their state-sponsored competitors but don’t benefit from government backing.

WORLD’S SAFEST BANKS 2019 — The 50 Safest Commercial Banks

Rank	Company Name	Country	Fitch	Moody’s	S&P	Total Score	Assets ($ Mil.)	Statement Date
1	Royal Bank of Canada	Canada	AA	Aa2	AA—	23	1,021,770	30-Apr-2019
2	TD Bank	Canada	AA—	Aa1	AA—	23	1,005,270	30-Apr-2019
3	DZ Bank	Germany	AA—	Aa1	AA—	23	594,157	31-Dec-2018
4	DBS Bank	Singapore	AA—	Aa1	AA—	23	402,439	31-Dec-2018
5	Oversea-Chinese Banking Corporation	Singapore	AA—	Aa1	AA—	23	341,646	31-Dec-2018
6	Svenska Handelsbanken	Sweden	AA	Aa2	AA—	23	331,978	31-Dec-2018
7	United Overseas Bank	Singapore	AA—	Aa1	AA—	23	283,590	31-Dec-2018
8	Deutsche Apotheker- und Aerztebank	Germany	AA—	Aa1	AA—	23	51,961	31-Dec-2018
9	Swedbank	Sweden	AA—	Aa2	AA—	22	250,461	31-Dec-2018
10	DNB Bank	Norway	NR	Aa2	AA—	21.5	256,383	31-Dec-2018
11	Banque Pictet & Cie	Switzerland	AA—	Aa2	NR	21.5	29,780	31-Dec-2017
12	Bank of Nova Scotia	Canada	AA—	Aa2	A+	21	759,772	31-Oct-2018
13	ANZ Banking Group	Australia	AA—	Aa3	AA—	21	694,368	31-Mar-2019
14	Commonwealth Bank of Australia	Australia	AA—	Aa3	AA—	21	682,915	30-Jun-2019
15	Nordea Bank	Finland	AA—	Aa3	AA—	21	631,583	31-Dec-2018
16	Westpac	Australia	AA—	Aa3	AA—	21	619,905	31-Mar-2019
17	Bank of Montreal	Canada	AA—	Aa2	A+	21	617,358	30-Apr-19
18	National Australia Bank	Australia	AA—	Aa3	AA—	21	569,267	31-Mar-2019
19	Canadian Imperial Bank of Commerce	Canada	AA—	Aa2	A+	21	454,684	30-Apr-2019
20	SEB	Sweden	AA—	Aa2	A+	21	286,202	31-Dec-2018
21	HSBC France	France	AA—	Aa3	AA—	21	207,256	31-Dec-2018
22	First Abu Dhabi Bank	UAE	AA—	Aa3	AA—	21	202,585	31-Dec-2018
23	Hang Seng Bank	Hong Kong	A+	Aa2	AA—	21	200,666	31-Dec-2018
24	Federation des Caisses Desjardins du Quebec	Canada	AA—	Aa2	A+	21	115,505	31-Dec-2018
25	AgriBank	United States	AA—	Aa3	AA—	21	109,772	31-Dec-2018
26	UBS	Switzerland	AA—	Aa3	A+	20	958,055	31-Dec-2018
27	Rabobank	Netherlands	AA—	Aa3	A+	20	676,287	31-Dec-2018
28	CoBank	United States	AA—	Aa3	AA—	20	139,016	31-Dec-2018
29	National Bank of Kuwait	Kuwait	AA—	Aa3	A+	20	90,327	31-Dec-2018
30	OP Corporate Bank	Finland	NR	Aa3	AA—	20	72,742	31-Dec-2018
31	AgFirst	United States	AA—	Aa3	NR	20	33,078	31-Dec-2018
32	Farm Credit Bank of Texas	United States	AA—	Aa3	NR	20	24,529	31-Dec-2018
33	BNP Paribas	France	A+	Aa3	A+	19	2,337,575	31-Dec-2018
34	U.S. Bancorp	United States	AA—	A1	A+	19	467,374	31-Dec-2018
35	LGT Bank	Liechtenstein	NR	Aa3	A+	18.5	35,089	31-Dec-2018
36	Credit Agricole	France	A+	Aa1	A+	18	2,124,447	31-Dec-2018
37	BPCE	France	A+	A1	A+	18	1,459,156	31-Dec-2018
38	Banque Federative du Credit Mutuel	France	A+	Aa3	A	18	612,918	31-Dec-2018
39	The Bank of New York Mellon Corp.	United States	AA—	A1	A	18	362,873	31-Dec-2018
40	Kookmin Bank	South Korea	A	Aa3	A+	18	318,344	31-Dec-2018
41	Shinhan Bank	South Korea	A	Aa3	A+	18	310,821	31-Dec-2018
42	State Street	United States	AA—	A1	A+	18	244,626	31-Dec-2018
43	Qatar National Bank	Qatar	A+	A1	A+	18	236,786	31-Dec-2018
44	National Bank of Canada	Canada	A+	Aa3	A	18	199,719	31-Oct-2018
45	Northern Trust	United States	AA—	A2	A+	18	132,213	31-Dec-2018
46	Suncorp-Metway	Australia	A+	A1	A+	18	47,026	31-Dec-2018
47	Kiwibank	New Zealand	AA—	A1	A	18	14,556	31-Dec-2018
48	HSBC Holdings	United Kingdom	AA—	A2	A	17	2,558,124	31-Dec-2018
49	ABN AMRO Bank	Netherlands	A+	A1	A	17	436,736	31-Dec-2018
50	BNP Paribas Fortis	Belgium	A+	A2	A+	17	333,678	31-Dec-2018

Asset figures from Fitch, Moody’s, and company reports. Ratings valid as of Aug. 31, 2019.