Tuesday, March 20, 2012

Largest USA Banks Ratings: U.S. Bancorp Leads, Goldman Sachs Last

Largest USA Banks: Ratings and Rankings

U.S. Bancorp is the sole leader at A, followed by PNC Financial Services and Wells Fargo at A-. These 3 banks have moved positively beyond the 2008 financial crisis. Bank of New York Mellon is 4th at a respectable B+. Bank of America is next at #5, a surprise to some, with a ranking of C+. Despite the negative media hype, capital is strong. However, return on assets is inadequate. Bank of America financial performance has been extraordinarily volatile and could move the ranking up or down in the next QE March 2012.
JPMorgan Chase is sixth at D, despite CEO Jamie Dimon's trumpeting of the JPM "fortress balance sheet" of $2.27 trillion. However, financial position and performance are adequate. Next are Citigroup and Morgan Stanley at D-, just below the median score of D. Trailing the field at #9 is the once mighty Goldman Sachs at a dismal G+. Capital is inadequate. The Average Rating for the 9 largest USA banks is C-, just above the median score of D in the overall rating system.

Rating, Bank
A    U.S. Bancorp
A-   PNC Financial Services
A-   Wells Fargo
B+  Bank of New York Mellon
C+  Bank of America
D    JPMorgan Chase
D-   Citigroup
D-   Morgan Stanley
G+  Goldman Sachs
C-   Average

Largest USA Banks Rankings The Largest 9 USA banks ratings are presented below in a percentage format. The ratings range from A+ (100%) to G- (0%).

Based on fundamental analysis of both financial position and performance on a short-term and long-term basis, the largest 9 USA banks rankings have been updated with a composite score. The ratings are based on the December 31, 2011 financial statements. The score can range from a high of A+ to a low of G-, a total of 21 tiers. The median score is D in this rating system. Financial position strength, notably the capital ratio, is weighted more than recent financial performance. The rating therefore is primarily a gauge of financial position, balance sheet, strength, which indicates the ability of the bank to withstand financial shock or a downturn in financial performance. The rating is secondarily a gauge of financial performance, both short-term and long-term.

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