The Brand Finance Banking 500, conducted by leading brand valuation consultancy Brand Finance, ranks the world’s biggest banks by their brand value. The results, published in the February edition of The Banker magazine, reflect industry trends and indicate future developments.
Most U.S. banks are growing strongly thanks to monetary policy that has driven a recovery in the economy. Wells Fargo, the world’s most valuable bank brand, leads the charge. It has added $4.2 billion of brand value to reach a total of over $30 billion. Lending across a huge range of categories, the improved domestic economy has driven revenues and helped Wells Fargo overtake JP Morgan to become the world’s most profitable bank.
In addition to benefitting from broader economic growth, the bank has made attention to customers central to its brand. Interestingly, Wells Fargo also enjoys a more favorable reputation than its peers with the general public, whether customers or not. This is reflected is its enhanced brand rating, up to AAA-. Despite the success, Wells Fargo is closely followed by Bank of America and Citi, which have grown their brands by $4.3 billion and $2.8 billion respectively.
The increased number of IPOs this year has helped many investment banks and Goldman Sachs in particular. Last year, there were 222 IPOs, seven times the figure for 2008. Consequently, Goldman has grown its brand value faster than any major bank. It is up 37 percentto a total of over $10 billion.
The successes of America’s top banks are not quite matched by those lower down the list. In fact, at a time of wealth polarisation and calls for greater competition in banking, there has been a further consolidation around the biggest U.S. banking brands. In 2013 the top 10 represented 68 percent of the total value of all U.S. brands in the table, in 2014, that figure is 83 percent.
Brand Finance Chief Executive David Haigh commented, “This year’s Brand Finance Banking 500 shows clearly the recovery not just of the US economy but also the reputation of America’s biggest banks. Looking forward, banks will be concerned that tapering will restrict the liquidity that has allowed them to rebuild over the last year. However by focusing on brand and reputation as well as financials, banks such as Wells Fargo will be well placed to prosper QE free.”
In addition to the success of US banks, western brands in general have shown promising improvements. HSBC, UBS and BNP Paribas are Europe’s biggest winners, up $4 billion, $3.35 billion $1.6 billion respectively. Meanwhile the total for Greece is more than100 percent as successful austerity measures have begun to rapidly transform the country’s economic outlook.
Notable results from elsewhere in the world included the halting of rapid growth in some BRIC countries, namely Russia, India and Brazil. Their national brand value totals are down 6 percent, 13 percent and 23 percent respectively. China, however, continues to grow strongly. Its banks have added a total of nearly $19 billion and there are now three Chinese bank brands in the global top ten.