The wits at the Economist have compiled a list of the world’s best banks, which they preface as follows:
Trying to work out which banks are the world’s best is a bit like awarding the prize for prettiest war-torn village. It is a title that carries little kudos. It is also likely to prompt further shelling. Winners of industry awards in the past three years include Ken Lewis, the chief executive of Bank of America, for banker of the year (2008); Société Générale for its risk management; and Angelo Mozilo of Countrywide, a failed mortgage lender, for a “lifetime of achievement”.
Moreover:
to win the shiniest medals, you need to have come under fire. In the heat of battle, which banks have come off best?
In typical Economist style, it’s not really a list – there’s nary a bullet point to be found. Still, it offers up some interesting points – and descriptions:
Rabobank – “a wonderfully dull co-operative bank in the Netherlands”
HSBC - “has lost more to date than the likes of Royal Bank of Scotland, now largely in the hands of the state, and JPMorgan Chase, which has far more exposure to both America and investment banking. That is hard to forgive.”
Goldman – “In America, Goldman still has legions of admirers…But its renewed swagger should not conceal the fact that it needed to convert into a bank-holding company in order to survive the market storm—nor the questions that hang over its future earnings in a re-regulated industry.”
The piece is worth reading in full, but if you’re the type inclined to skip to the end of the book, Credit Suisse and JP Morgan are the banks which received the Economist’s poisoned chalice:
Credit Suisse has had its share of mishaps during the crisis but it was quick to scale down its balance-sheet, has plotted a credible strategy for its investment bank and pulled well ahead of UBS, its main rival in wealth management.
As for JPMorgan Chase, it has kept a tight rein on risk, managed capital well and acquired sensibly.
None of this is much comfort for weary Swiss and American taxpayers, of course. Well-run or not, both banks present the problem of being far too important to fail. And that’s to say nothing of the curse of awards.
Related link:
Banker of the year goes bye, bye, bye? – FT Alphaville