♠ Posted by Emmanuel in
Europe
at 10/27/2013 04:49:00 PM
Your initial reaction will likely be the same as mine:
Who are these guys? After years dabbling in own-account speculation, derivatives and other get-rich-quick schemes, the stalwarts from days gone by are no longer on this list. Deutsche Bank? You must be joking. American money center banks? Get outta here! Instead, we have an interesting combination of European banks with government ownership and Singaporean banks with conservative practices. From the
press blurb:
The safest 10 banks in the world are all European, just as they were
last year and the year before that. However, in all but one case, that
safety arises largely as a result of ownership by a European government
or sponsorship by government-related entities. Of the 10 banks that lead
this year’s rankings of the World’s Safest Banks, only one, Rabobank,
is privately owned.
As in recent years, Germany’s KfW heads the rankings, though four
other institutions also have AAA ratings from Fitch, Moody’s and
Standard & Poor’s (S&P): Bank Nederlandse Gemeenten, Zürcher
Kantonalbank, Landwirtschaftliche Rentenbank and L-Bank.
No privately owned bank holds a Triple-A rating from any of the three
agencies, although four have an Aa1 from Moody’s: TD Bank Group and the
three leading Singaporean banks, DBS Bank, Oversea-Chinese Banking
Corporation and United Overseas Bank. Neither Fitch nor Standard &
Poor’s assigns AA+ ratings to any private bank.
Global Finance's rankings are based on ratings of the three major agencies, by the way. My intuition is not so much that government ownership guarantees the safety of the aforementioned European banks (
sorry, WSJ
Deal Journal), but by charter or mandate they are required to maintain conservative banking practices. In other words, they tend to stick to the low risk spectrum with its accompanying implications for reward (at least in a short-term sense). Hence, I am puzzled as to why the privately-owned Rabobank cracks the top 10, not least because it's been
implicated in the LIBOR-fixing in a big way. Go figure.
