Top 50 Safest Commercial Banks 2018

Commercial bank rankings were impacted by many of the same trends impacting our Global 50 ranking, with stability-enhancing regulation pushing banks to strengthen fundamentals. 

TD Bank reclaimed the top spot in our 2018 ranking after relinquishing it to DZ Bank in 2017. Several other Canadian banks improved their positions in the ranking as a result of a Moody’s upgrade that impacted Royal Bank of Canada (2nd), Bank of Nova Scotia (12th), Bank of Montreal (17th), Canadian Imperial Bank of Commerce (18th) and new entrant National Bank of Canada (41st).

Swedbank, SEB and HSBC France likewise all rose in our ranking following a Moody’s upgrade, while downgrades from the same agency caused Rabobank, Hang Seng Bank and LGT Bank to fall. Following a Fitch downgrade, Qatar National Bank, Nationwide Building Society, U.S. Bancorp and Banco Santander Chile all moved lower. In addition to National Bank of Canada, notable newcomers to our list include Credit Agricole, ABN AMRO Bank and BNP Paribas Fortis, which benefited from these ratings fluctuations.

The rise of online lending platforms will continue to be a catalyst for innovation; commercial banks must evaluate whether they want to “buy or build” their digital business to compete. These platforms use automated credit processes to analyze and approve loan applications, resulting in faster access to credit. These efficiencies also benefit other products and business lines, such as cash management—where payment speed is critical—small-business lending and trade finance.  

The refinement of blockchain technology will benefit corporate banking in products such as syndicated lending, cross-border payments and supply-chain finance. It will also improve internal client risk-management processes associated with KYC (know your customer) and AML (anti-money laundering) initiatives.

Some banks are collaborating on a number of efforts, including Digital Trade Chain, which uses blockchain technology to provide a trade finance platform to small and medium-size corporations, and Fusion LenderComm, which utilizes blockchain technology with syndicated lending. These new initiatives have significant implications for the traditional branch model of the commercial banking sector. As a result of greater lending volumes being conducted over digital platforms, the need for brick-and-mortar branches is declining. Increasing the range of product offerings and improving service speed allows institutions that know how to compete in the new environment to build new relationships and strengthen existing ones.

Not surprisingly, with innovation comes greater concern for banking safety—and with that, more intense regulation of the banking sector. For example, the Office of the Comptroller of the Currency, which supervises all national banks and thrift institutions in the US, is considering granting special-purpose bank charters to fintech companies, requiring them to comply with a set of national standards rather than individual state requirements.

Our ranking of the Safest Commercial Banks excludes banks that are majority-owned by governments or enjoy sponsorship from their governments or regional bodies. The institutions on our list face the same challenges and operate in the same markets and jurisdictions as state-supported banks, but don’t benefit from government backing or direct access to some large lending opportunities, such as government infrastructure projects.

Asset figures from Fitch, Moody’s, and company reports. Ratings valid as of Aug. 17, 2018.