USA Bank Ratings

Bank Ratings Through December 31, 2012

The 10 Largest USA Banks have reported fourth quarter 2012 financial results, i.e., financial performance for the quarter ending 12-31-12 and financial position at 12-31-12. There were several changes in the quarterly ratings: 4 upgrades and 2 downgrades. The median score is "D" and the average score for the quarter ending December 2012 is "C+", an increase from the average score of "C" for the prior quarter ending September 2012.

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%).

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

Above Average U.S. Bancorp is the sole leader at "A", followed by Wells Fargo, Capital One, and PNC Financial Services at "A-". These 4 banks have moved positively beyond the 2008 financial crisis. BNY Mellon and Citigroup are next at "B+" and "B-", respectively.

Average Bank of America is at the average of "C+".

Below Average JPMorgan Chase and Goldman Sachs are next at "D", which is the median rating. Trailing the field is Morgan Stanley at a dismal "G".

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 the latest quarterly 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 can vary each quarter.

Financial position 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 internal and/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 predominant intent of the ratings.


Seeking Alpha