Chinese lenders led by ICBC dominated the world's top five most valuable banking brands, while 10 UAE banks led by Emirates NBD, First Abu Dhabi Bank and ADCB featured in the top 100 ranks.
The brand value of the world's largest banks contracted for two consecutive years, according to consultancy Brand Finance. Nearly two-third of the world's 500 most valuable bank brands recorded losses in brand value, as profits and interest rates were impacted by the Covid-19 pandemic, according to the Brand Finance Banking 500 2021 report issued on Monday.
"Banking institutions were the main culprit in the last financial crash; this time around they are a large part of helping people overcome the repercussions of Covid-19," David Haigh, chief executive of Brand Finance, said. "Brand Finance research shows that banks’ responses to the global pandemic have led to a year-on-year increase in overall reputation scores among customers, which no doubt could result in an uptick in brand values in the coming year.”
Chinese banks held their dominance over the top rankings, accounting for one-third of total brand value and seven of the 10 top climbers by absolute brand value.
While two-thirds of banking brands in the ranking have experienced losses, Chinese lenders recorded a healthy 3 per cent average brand value growth. That is due to the banking sector’s role in China’s timely and effective response to Covid-19, which included regulatory policy adjustments for asset management, wealth management, and inter-banking, as well as increased investment into digitalisation, the report said.
Despite a 10 per cent drop in brand value to $72.8 billion, ICBC remains the world’s most valuable banking brand, followed by China Construction Bank and Agricultural Bank of China.
Five US banks claimed spots in the top 10, with Bank of America highest ranked in fifth position and a brand value of $32.8bn. It was followed by Citi, Wells Fargo, Chase and JP Morgan.
JP Morgan and Chase, which merged in 2000, still provide services to clients under separate brands. Since Brand Finance evaluates brands, as opposed to companies, these are valued separately.
JP Morgan was the only brand in the top 10 to record a growth in brand value, up three per cent to $23.6bn.
US banks account for almost a quarter of the total brand value in the ranking, with the country's 74 banks reaching a cumulative brand value of $274.8bn.
Vietnam’s banking sector saw the greatest year-on-year brand value growth compared to any other nation, standing at 23 per cent.
Vietnam’s ability to effectively control and constrain Covid-19 has allowed it to buck the sector-wide trend of declining brand value, the report said.
The Union Bank of India was the fastest growing in ranking, more than doubling to $1.2bn and simultaneously soaring 128 places to claim the169th position.
While some of the world's largest banks struggled during the pandemic, 23 newcomers have joined the ranking from Europe, Asia, the US, and South America.
The highest new entrant is Truist in 36th position, with a brand value of $8bn.
Sberbank, Russia's largest lender, increased in brand strength year-on-year to become the strongest brand in the banking ranking, with a Brand Strength Index (BSI) score of 92.0 out of 100 and a coveted AAA+ brand strength rating.
Ten banks from the UAE featured in the banking report, with a combined brand value of $13.7bn.
Leading the pack is Emirates NBD, which sits in 74th position in the overall ranking despite the impact of the pandemic. The lender is the official partner of the Expo2020 – rescheduled to commence in October – which will be "the perfect opportunity to boost the brand’s profile globally as it helps to demonstrate the nation’s innovative culture," the report said.
First Abu Dhabi Bank's brand value is $3.6bn while ADCB stood at $2.1bn. The two lenders are the UAE's second and third most valuable banking brands respectively, the report showed.
National Bank of Fujeirah's brand value increased 2 per cent to $259 million. Commercial Bank of Dubai's brand value is estimated at $334m, while Mashreq, Dubai's oldest bank has a brand value of $484m.
