Banking's Top Performers 2002: At the Most Profitable Big Banks and Thrifts, Wider Margins (Thank You, Fed) Offset Credit Quality Woes. Fee Income Also Proved a Big Differentiator. (Top One Hundred; Part I: The Large Banks)
2002; American Bankers Association; Volume: 94; Issue: 6 Linguagem: Inglês
ISSN
0194-5947
Autores Tópico(s)Banking stability, regulation, efficiency
ResumoMany were surprised that the banking industry performed as well as it did in 2001, until they remember that there were no fewer than 11 Fed rate cuts during the year and acknowledge that, whether or not we like to admit it, most banks' profitability is still largely based on intermediation. What this meant in 2001 was that while other businesses large and small suffered through the symptoms of an economic recession, laid off workers, reined in capital expenditures, wrung their hands over the stock market and consumer confidence indices, and generally struggled to survive, banks got lucky. Funding costs fell and margins rose, in many cases offsetting what could have been disastrous losses due to credit quality problems, domestic and international instability, and the general economic downturn. In the end, the industry made out all right. In part one of the tenth annual ABA Banking Journal performance rankings, we review the financial results and strategies of the nation's largest banks, thrifts, and specialty lenders. Part two, which will appear next month, will highlight the top performing community banks and thrifts in 2001. Banks and thrifts combined Our study ranks the performance of domestic publicly held institutions with assets over $1 billion as of Dec. 31, 2001. Two groups were included in our analysis: depository institutions (banks, thrifts, and bank or financial holding companies); and specialty lenders. In the past, banks and thrifts were analyzed separately. However, the distinctions between them have been disappearing. As a result of the loosening of regulatory restrictions on thrifts' holdings and operations, they have been able to diversify their assets and create alternative sources of income, allowing them to match the performance levels of their bank and bank holding company counterparts. The convergence has meant that, at least among the largest institutions, banks and thrifts are becoming nearly indistinguishable from one another. A total of 292 banks, thrifts, and holding companies qualified under our selection criteria. They were ranked by return on average equity for 2001. In instances where the reported ROE was identical for two or more institutions, 2001 return on average assets was used as a secondary ranking criterion. This year a separate ranking of the top-performing private institutions in the industry is included. To qualify for a ranking, an institution must be a consolidated domestic bank, thrift, or holding company with assets over $1 billion. This includes domestic subsidiary holdings of foreign-owned banks and holding companies. Subsidiaries of publicly held companies that qualified for ranking on our other lists were excluded from this analysis. Over 130 private institutions qualified for ranking in 2001. The same methodology was used for specialty lenders, of whom 23 qualified for ranking in 2001. (Fannie Mae, Freddie Mac, and the Federal Agricultural Mortgage corporation were excluded from the specialty lender ranking.) All data was provided by SNL Financial LC as of December 2001 from Securities and Exchange Commission filings. Comings and goings Twenty-one freshmen grace the list this year. The highest performing neophyte, Hudson United Bancorp of Mahwah, N.J., was the only newcomer to crack the top ten, ranking 4th for the year. Doral Financial Corporation of San Juan, last year's 10th ranked specialty lender, ranked 10th this year after becoming a financial holding company and expanding its banking operations. Four of last year's top ten bank, thrift, and holding company institutions retained their spots in the upper echelon. Westamerica Bancorporation of San Rafael, Calif., and TCF Financial Corporation of Wayzata, Minn., each moved up a spot to rank 3rd and 8th, respectively. The top performing thrift of 2000, Washington Mutual, Seattle, ranked 6th this year on the combined list, and Mellon Financial Corporation, Pittsburgh, moved into the coveted top spot, continuing its ascension after ranking 3rd in 2001. …
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