Bank Watch List

Balance sheets and financial results-based evaluations are by nature and definition backwardlooking. To overcome this, we introduced a forwardlooking element called the “Bank Watch List” into the strongest bank evaluation.

It identifies and considers the impact of specific evaluation parameters on balance sheet strengths, should macro-economic and business conditions change. By identifying the parameters and institutions that are most likely to be impacted by such changes, we aim to provide a holistic 360 degree view of the ranking without materially changing the composition of the scorecard.

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2019

2018

Strength Rank 2019	AB 500 Rank 2019	Commercial Bank	Country	Gross NPL Ratio (%)	Loan Loss Reserves to Gross NPLs (%)
493	419	Janata Bank	Bangladesh	33.6	19.1
464	164	IDBI Bank	India	27.5	70.3
450	355	Sonali Bank	Bangladesh	26.1	42.7
417	215	UCO Bank	India	25.3	63.5
384	203	Indian Overseas Bank	India	22.1	55.8
477	160	Central Bank of India	India	19.3	61.6
457	496	Rupali Bank	Bangladesh	17.9	33.4
466	433	Agrani Bank	Bangladesh	17.8	48.7
460	204	Allahabad Bank	India	17.6	74.1
346	296	United Bank of India	India	16.5	51.2
460	275	Bank of Maharashtra	India	16.4	70.0
444	202	Andhra Bank	India	16.2	68.5
437	68	Punjab National Bank	India	15.9	61.4
450	88	Bank of India	India	15.9	64.9
497	225	Corporation Bank	India	15.3	66.6
470	111	Union Bank of India	India	15.0	57.2
496	224	Suruga Bank	Japan	13.0	55.6
237	314	National Bank of Pakistan	Pakistan	12.7	99.7
415	193	Oriental Bank of Commerce	India	12.7	55.8
473	347	Punjab & Sind Bank	India	11.8	41.4
489	174	Syndicate Bank	India	11.4	47.4

Source: Asian Banker Research, S&P Global Market Intelligence

What does it mean to be in the Bank Watch List?
In this year’s ranking, we have identified gross non-performing loan (NPL) ratio (above 10%) and loan loss reserves to gross NPLs ratio (below 100%) as key parameters that will impact financial strength. The “Bank Watch List” is a tool to monitor and review the parameters to give a holistic view of the financial strengths of the institutions under evaluation. This is the first iteration of what we think will be a powerful tool for the industry to benchmark financial strength and will be continuously enhanced.

Who are in the Bank Watch List?
Although there were slight improvements in the overall asset quality of Asia Pacific banking sector in the financial year 2018, asset quality remains a crucial issue in the region. While India, Indonesia and Pakistan saw their banks’ asset quality improved, banks in Bangladesh, Brunei, the Philippines and Sri Lanka recorded higher average gross non-performing loan (NPL) ratios.

This year’s Bank Watch List includes fifteen Indian banks, four Bangladeshi banks and one each from Japan and Pakistan. Among all the 20 countries and territories, the asset quality of banks in Bangladesh and India remained the weakest. The lower formation of new bad loans,higher recoveries and resolutions from large stressed assets under the Insolvency and Bankruptcy Code (IBC) contributed to the improved asset quality of Indian banks. Nonetheless, the levels of non-performing assets were still higher than in the financial year ended 31 March 2017.