Bank’s profitability and liquidity depend on the amount of assets it holds. Assets play a significant role in determining the size of the bank. Assets show the worth of a bank and include both liquid wealth and property owned by the bank that can be converted to cash. Assets are divided into two types, current assets, and non-current assets. The basic accounting equation for calculating asset is liabilities + stakeholders’ equity. The ranking of banks is on the value of assets they own.
The Giants Of The Banking World
Industrial and Commercial Bank of China (ICBC)
Industrial and Commercial Bank of China is an international financial company and by far the largest bank in the world on asset value. ICBC is a government owned bank which initially was as a limited company in 1984. As of June 2015 the bank had an asset value of US$ 3,616.39 billion. In 2006 ICBC was listed in the stock market in both Shanghai and Hong Kong. The bank has continued to grow to form a strong customer base, market competitiveness, market innovation, and diversified business structure. ICBC has a total of 490 million retail customers and 5,320 thousand corporate customers with its branches spread across Asia, Europe, America, and Oceania.
China Construction Bank Corporation (CCB)
China Construction Bank Corporation was founded in 1954 and is the second largest bank in the world on asset value. Initially called People’s Construction Bank of China, the bank is also the 6th largest company worldwide. CCB has 13,629 branches locally in China and several branches in different parts of the world. CCB has a total asset of US$ 2,939.15 billion.
Agricultural Bank of China (ABC)
The ABC was established in 1951 and comes as the third largest bank in the world. It has its central operations in Beijing with several branches spread across China, Tokyo, Hong Kong, London, New York, Frankfurt, Sydney, Singapore, and Seoul. In total ABC has 24,000 branches and retail customers totaling 320 million while the corporate clients total 2.7 million. In 2010 ABC went public fetching the biggest IPO in the world. In 2015 ABC was ranked third by Forbes as the most valuable company with an asset value of $ 2,816.60 billion.
HSBC Holding is among the largest banks outside of China and Asia it is ranked fourth largest bank in the world, and its headquarters is in London. It is an international banking and financial service company. HSBC has asset value of $ 2,670.00 billion. Founded in 1865 by Shanghai and Hong Kong Banking Corporation Limited, HSBC is a holding company for the group. HSBC Holding has over 6,000 offices spread across 71 countries in Africa, Asia, Europe, America, and Oceania. HSBC works around four business areas includes global retail banking, commercial, and global private banking.
The Future Of Banking Operations
The biggest financial institutions especially banks have evolved into complex institutions offering a broad range of financial services to international markets controlling trillions of dollars in both cash and assets. With innovation and technology, banks are identifying new business and markets and developing customized products and services. With globalization, minimal regulations, consolidation, and diversification the banking industry is likely to be more complex.
The Largest Banks In The World
|Rank||Bank name||Total assets (US$ billion)|
|1||Industrial and Commercial Bank of China||3,616.39|
|2||China Construction Bank Corporation||2,939.15|
|3||Agricultural Bank of China||2,816.60|
|5||Bank of China||2,629.31|
|6||JPMorgan Chase & Co.||2,449.60|
|8||Mitsubishi UFJ Financial Group (MUFG)||2,323.24|
|9||Bank of America||2,149.03|
|10||Crédit Agricole Group||1,911.27|
|15||Japan Post Bank||1,701.60|