Safest Emerging Markets Banks 2013

ANNUAL REPORT: SAFETY COMES FIRST

Global Finance presents its annual ranking of the Top 50 Safest Banks in the Emerging Markets.

National Bank of Abu Dhabi (NBAD) is the safest emerging markets bank, following its October upgrade by Standard and Poor’s. The bank now holds AA- ratings from all three major ratings agencies. It’s the only emerging markets bank to do so.

Eight banks follow NBAD in the rankings, with two AA- ratings and an A+. Banks in Asia and the GCC account for 44 of the safest 50 banks in emerging markets, further strengthening those regions’ positions in comparison to recent years. In 2012, Asian and GCC banks accounted for 43 of the top 50 banks, and in 2011 they accounted for 39.

Three countries contribute the 22 Asian banks in the top 50: South Korea, with 10; China, with eight; and Taiwan with four. In contrast, five of the six GCC states contribute to the 22 GCC banks in the top 50—Bahrain is the exception. Saudi Arabia contributes nine banks to the top 50, the same as last year. They account for three-quarters of all locally incorporated Saudi banks, and an even bigger proportion of Saudi banking assets.

Outside Asia and the GCC, only two countries contribute banks to the top 50: Chile, with four, and the Czech Republic, with two. New entrants to this year’s rankings include HSBC Bank Oman (ranked 48), the result of a merger earlier this year between HSBC’s branch in Muscat and the locally owned Oman International Bank; and China’s Bank of Communications (ranked 49), which was upgraded by Fitch.

This year’s rankings also include the Export-Import Bank of China and the Export-Import Bank of Korea, both of whose ratings place them near the top of the rankings. As was the case last year, two A- ratings and one A was the standard needed to claim a place in the top 50 global rankings.

The regional lists continue to be dominated by banks in a handful of countries. Chilean and Mexican banks hold all but two of the top 10 positions in Latin America. In Central and Eastern Europe and the former Soviet Union, Czech and Polish banks dominate, although Russia’s Vnesheconombank retains its position in the top 10, at number seven, and Sberbank, at nine.

Outside the global and regional rankings, over the past year, both Fitch and Moody’s have upgraded the Turkish Republic and many of its banks to investment grade. Malaysian banks hold higher ratings than many of the banks listed in the regional rankings, but they fail to score highly enough to be included in the Asian regional list.

Outside South Africa, rating coverage of banks in sub-Saharan Africa remains small, and only South African institutions hold investment-grade ratings.

N/R – No Rating
Ratings as of 25 October 2013
Source for ratings: Fitch Ratings, Standard & Poor’s, Moody’s Investors Service
Source for reporting assets: Fitch Solutions, except *Moody’s Investors Service, **Bank’s financial statements