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Chinese banks increased their lead as the biggest financial institutions in the world in 2021 and U.S. banks also improved their rankings while many European banks lost ground, according to S&P Global Market Intelligence's annual ranking of the 100 largest banks in terms of total assets.
Twenty-six of the 37 European lenders on the list fell in ranking by between one and nine notches from a year earlier. Total assets of all European banks on the list shrank by 2.16% to $36.9T in 2021 from $37.7T a year earlier.
"European lenders saw their balance sheets shrink as their home markets offered slower economic growth relative to the rest of the world," said Nathan Stovall, principal analyst at S&P Global Market Intelligence. "Several European lenders also scaled back their stateside operations after facing strong competition from major U.S. lenders."
For example, Spain's Banco Bilbao Vizcaya Argentaria (BBVA) fell one spot to No. 47 after selling its 639-branch business in the U.S. with almost $103B in total assets to PNC Financial (PNC).
Industrial & Commercial Bank of China (OTCPK:IDCBY) (OTCPK:IDCBF), China Construction Bank (OTCPK:CICHY) (OTCPK:CICHF), Agricultural Bank of China (OTCPK:ACGBY) (OTCPK:ACGBF), and Bank of China (OTCPK:BACHF) (OTCPK:BACHY) held on to their top four positions with expanded balance sheets, widening their lead.
Among U.S. banks, JPMorgan Chase (JPM), Bank of America (BAC), and Goldman Sachs (GS) saw balance sheet growth in 2021. JPMorgan (JPM) rose one notch to No. 5 and Bank of America (BAC) improved by two spots to No. 7.
"Government efforts to mitigate the economic impact of the pandemic flooded the markets with liquidity and inflated U.S. bank balance sheets," Stovall said. "The absence of government stimulus and the Fed's efforts to combat elevated inflation, including through the reduction of its $9T balance sheet, will lead to slower balance sheet growth in the future."
Also in the top 10 largest banks in the world are: Mitsubishi UFJ Financial Group (MUFG) at No. 6 (down from No. 5 in 2020); HSBC Holdings (HSBC) in eighth place (unchanged from 2020); BNP Paribas (OTCQX:BNPQF) (BNPAQY) at No. 9, down two spots from a year earlier; and Credit Agricole Group (OTCPK:CRARF) (OTCPK:CRARY), unchanged. (Added at 11:50 AM ET).
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