Wednesday, August 8, 2012

Largest USA Banks Ratings: U.S. Bancorp & Wells Fargo Tops, Goldman Sachs Last

The Largest USA Banks have reported second quarter 2012 financial results. There were several changes in the quarterly ratings: 3 upgrades and 2 downgrades. The median score is "D" and the average score for the QE June 2012 is "C".

Above Average U.S. Bancorp is the sole leader at "A", followed by Wells Fargo and Capital One at "A-". These 3 banks have moved positively beyond the 2008 financial crisis. PNC Financial Services is next at "B+", followed by Bank of New York Mellon and Bank of America at "B".

Below Average JPMorgan Chase follows at "D". Citigroup is next with a "D-", below the median rating of "D". Farther below is Morgan Stanley at "E+". Trailing the field is Goldman Sachs, continuing at a dismal G+.

Rating, Bank, Change
A      U.S. Bancorp
A-     Wells Fargo
A-     Capital One => (downgrade from A)
B+    PNC Financial Services => (downgrade from A-)
B      BNY Mellon => (downgrade from B+)
B      Bank of America => (upgrade from C+)
D     JPMorgan Chase
D-    Citigroup
E+    Morgan Stanley => (upgrade from F-)
G+   Goldman Sachs
C      Average

Largest USA Banks Rankings The 10 Largest 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 10 USA banks rankings have been updated with a composite score. There is no subjectivity involved from quarter to quarter, just objective data. The ratings are the result of the output from a model, with June 30, 2012 financial statement data input.

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. The average score varies each quarter.

Financial position strength, notably the capital ratio, is weighted more than financial performance. Therefore, the rating is primarily a gauge of financial position, balance sheet strength, which indicates the ability of the bank to withstand a downturn in financial performance from either internal or external events. The rating is secondarily a gauge of financial performance, both short-term and long-term. A measure of financial safety and soundness, not future financial performance, is the predominate intent of the ratings.


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