Jose J.

Solivan Rivera M00277003

Internet Exercise 1 - Internet exercise A

Worldwide Top Banks 2021

Fortune’s 2021 Global 500 Top company lists shows 5 Banks in the Top 50 companies

worldwide. Of this list the first 4 banks are from China, and in the fifth place is one from United

Sates. All this bank’s revenues are over 100 billion USD and are the only ones in this range.

China’s banks saw market shrinks the second quarter of 2021 as Beijing sought to curb excessive

borrowing and due pandemic uncertainty loomed, still all major banks sit at the top.

The fifth largest bank worldwide in 2021 Fortune’s 500 list is JP Morgan Chase, the U.S.

largest bank with revenues $129.5 billion USD, and profits of $29,1 billion USD. Financial

statements show a revenue decline of -9,1% and a major double digit profit decline of -20.0%,

versus previous year 2020, these negative changes dropped the bank 5 places from its previous

ranking in Fortune’s 500 list from 38th to the 43rd place, and in the banking sector from 4th to 5th

place. Its market value is $456,884 billion USD, and Total Stockholder Equity $279,354 billion

USD. The company ratios show a Profit as % of Revenues 22.5%, Profits as % of Assets 0.9%,

Profits as % of Stockholder Equity 10.4%. The company CEO Jaime Dimon, was worried Covid-

19 impact would create a major financial crisis but besides the virus struggles the bank remained

solid, drop-in revues were related to billions set aside to cover bad loans. On the bright side JP

Morgan’s CEO Dimon is predicting a “boom” that could run into 2023, and the firm has started to

release some of those loan loss reserves from 2020, which is a good indicator and a vote of

confidence on this recovery forecast.

 In the fourth place on Fortune’s 500 list is Bank of China, the country’s oldest bank and a

flagship lender, with revenues of just over $134 billion USD and $27,9 billion USD on profits, the

bank dropped its revenue -0.8% but increased profits by 3% YoY, which is the highest profit

percentual increase of all Top 5 banks. Bank of China assets are over $3,7 billion USD and the

bank has 309,084 employees. The bank jumped from the 43rd place in 2020 Fortune’s 500 list to

the 39th place. Its market value is $128,616 billion USD and Total Stockholder Equity $312,401

billion USD. The company ratios show a Profit as % of Revenues 20.9%, Profits as % of Assets

0.7%, and Profits as % of Stockholder Equity 8.9%. The bank increased its green finance initiatives

last year as Beijing targeted peak emissions by 2030 and carbon neutrality by 2060. In April 2021,

their profits increase (~3% = approximately $30 billion), beat all analysts’ estimates. It’s projected

a big increase in revenues as the bank continues investing in green projects plus new branches to

offer cross-border investment products for high-net-worth individuals.

Third place is the Agricultural Bank of China with $153.9 billion USD in revenues and

$31.3 billion USD in profits, these figures represent growth in revenue of 4.5% and in profits of

1.9%. The bank assets are over $4,169 billion USD, and they currently have 462,592 employees.

In 2021, the bank moved up six spots to No. 29 in this year’s Global 500 rankings—the largest

jump among China’s top four banks. The Agricultural Bank of China market value is $158,335

billion USD. The bank since its establishment has provided financial services for China’s rural

development. Going forward China’s governments efforts will be directed at rural revitalization,

combating rural poverty, and bridging the rural-urban wealth divide, which will boost the banks

territory and financials figures.

 Second place in the Top 5 banks worldwide based on Fortune’s 500 list is China

Construction Bank with revenues of $172 billion USD and profits of $39.2 billion USD, which

means a revenue growth of 8.3% the highest average between the Top 5 banks, and a profit growth

of 1.7% YoY. The bank assets are $4.3 billion USD and has 373,814 employees. The bank moved

up 5 spots and now is at the 25th place worldwide. Bank’s market value is $178,367 billion USD.

The bank continues to undertake its “new finance” strategy, which prioritizes investments in

financial technology and inclusive finance loans for small enterprises.

In the first place is the world’s largest lender by assets and state owned, the Industrial &

Commercial Bank of China, also moving up 4 spot to sit at the 20th place worldwide with over

$182.7 billion USD and increase of 3.2% YoY and a huge profit of $45,7 billion USD and increase

of 1.3% YoY. The bank’s assets are over $5.1 billion USD, and it has 439,787 employees. Bank

market value reaches $245.7 billion USD. This year the bank moved 4 spots, sitting now at the

20th place worldwide. Figures increases are aligned to China’s rebound from pandemic. In May

2021, the bank announced it will withdraw gradually of coal financing projects.

Based on the financial information and history provided in Fortune 500 list, it seems the

first 3 spot will remain unchanged, with a possibility of JP Morgan to reach again the 4th place,

based on the new projections and confidence shown by the US bank.

Fortune Editors. (2021, August 2). Global 500. Fortune.

https://fortune.com/global500/search/?fg500_industry=Banks%3A%20Commercial%20and%20
Savings§or=Financials