Five of the World’s Top 10 Banks Are China’s, ICBC on Top in Assets for 13 Years in a Row

China’s dominance has become clearer still in the global banking sector in terms of total assets. The first four places on the list of the world’s top 10 banks are all occupied by Chinese banks, and altogether five of the country’s banks have made a place in the top ten.

In this list, prepared on the basis of the latest data from S&P Global Market Intelligence, the Industrial and Commercial Bank of China, in short ICBC, has retained the first position as the world’s largest bank for the 13th consecutive year. The bank’s total assets stand at about 7 lakh 65 thousand crore US dollars, that is, 7.65 trillion dollars.

The analysis of the list says ICBC has long held the top position in the global banking sector because of its huge assets, extensive operations and strong position in China’s domestic economy.

In second place on the list is the Agricultural Bank of China, whose total assets are 6.97 trillion dollars. China Construction Bank Corporation, in third place, has assets of 6.52 trillion dollars, and the Bank of China, with assets of 5.48 trillion dollars, is in fourth place. That is, the world’s top four banks in terms of assets are all China’s.

The last place in the top ten has also gone to another bank of China’s. The Postal Savings Bank of China, in tenth place, has total assets of 2.67 trillion dollars. As a result, the combined presence of five Chinese banks on the top list highlights the huge scale and global importance of the country’s banking system.

Outside China, the United States’ JPMorgan Chase & Company is in fifth place on the list as the largest bank, with total assets of 4.43 trillion dollars. Although the amount of its assets is less than China’s top four banks, the bank’s influence in global financial markets is noteworthy, and in terms of share market capitalisation, or market cap, JPMorgan has also retained its position as the world’s most valuable bank.

Another large US financial institution, Bank of America, is in sixth place on the list, with total assets of 3.41 trillion dollars. The country’s large consumer banking operations, corporate financial services and presence in the investment banking sector have made the institution one of the most important parts of the international banking system.

Among Europe’s banks, France’s BNP Paribas has risen to the top this time. With assets of 3.28 trillion dollars, the bank is in seventh place in the world and has overtaken the UK’s HSBC. HSBC Holdings is in eighth place with assets of 3.21 trillion dollars, and another French bank, Crédit Agricole, is in ninth place with assets of 3.14 trillion dollars.

As a result, the presence of French institutions has become noteworthy among Europe’s leading banks as well — BNP Paribas and Crédit Agricole, both banks have made places in the top ten.

According to economic analysts, behind the huge assets of the Chinese banks are the country’s vast domestic savings, its large economy, government investment in the infrastructure sector, and the role of the bond and loan markets. The country’s banks have built a large asset base by financing industry, commerce, housing, infrastructure and various government projects; the huge population and domestic market have also played a role in deposit collection and the expansion of lending operations.

However, analysts warn that no conclusion can be reached that just because the size of total assets is large, a bank’s profit, quality of assets or financial risk management is equally strong in the same proportion. In such evaluations, indicators such as non-performing loans, capital adequacy, profit and liquidity must also be considered.

On the other hand, one source of the strength of the large US banks is investment banking, capital markets, asset management, corporate financing and international financial transactions. Europe’s large banks too are playing an important role in the global financial system through multinational business, international trade financing, corporate banking and asset management.

All in all, this list of the world’s largest banks in terms of total assets points to the growing financial presence of Asia, especially China, in the global economy. At the same time, the capital-market-centred strength of the US banks and the international operations of the European banks have also maintained their influence — but to compare real capability, indicators such as profit, capital, risk management and market value must also be kept in account alongside assets.