3 ms·

I am ignorant with regards to banking and finance, so forgive me if this is a silly question, but is there any reason that mutual societies (e.g. UK building so

I am ignorant with regards to banking and finance, so forgive me if this is a silly question, but is there any reason that mutual societies (e.g. UK building societies or US credit unions) do not seem to be included in the list? I am aware of course that the column "Price change since March 1st" would make no sense for these institutions, and maybe the other columns would also be irrelevant (as I say, I am an ignorant). Still, if the source data includes these institutions and it makes sense to add them, I would be very interested in seeing how for instance Britain's Nationwide or Spain's Caja Rural compare with publicly traded banks in this ranking of numbers that to be honest I don't really understand well enough to evaluate them.

pulse7 4y ago
Many mutual and building societies (like German Schwäbisch Hall) have a "closed system": they don't borrow/lend the money from/to central bank and open marked, but only from/to their clients. Those are isolated islands, mostly independent from financial system are are immune to crisis happening outside of their closed system...
deleted 4y ago
[deleted]
janmo 4y ago
The ranking is mainly based on stock price action and the price-to-book ratio. The main "asset" of a bank is trust and the price action is a very good indicator that shows if investors still trust the bank. My first intention was to mainly base my ranking on their balance sheet, but the balance sheet of SVB, Signature, Silvergate and Credit Suisse was average, it wasn't terrible (Many banks do much worse). In fact Moody's gave SVB an A rating. What broke SVB,Signature and Silvergate's neck was their lack of diversification, their high exposure to crypto and tech startups and the bankrun that ensued when crypto collapsed and VC cut their funding. Almost every bank can't sustain a bankrun. In the "cash equivalents % of total assets" column you can see how much of their assets the bank can actually let people quickly withdraw and it isn't that much. Silvergate had 40% of their assets in cash equivalents, more than almost every bank, and they still failed.

pulse7 4y ago

Many mutual and building societies (like German Schwäbisch Hall) have a "closed system": they don't borrow/lend the money from/to central bank and open marked, but only from/to their clients. Those are isolated islands, mostly independent from financial system are are immune to crisis happening outside of their closed system...

deleted 4y ago

[deleted]

janmo 4y ago

The ranking is mainly based on stock price action and the price-to-book ratio. The main "asset" of a bank is trust and the price action is a very good indicator that shows if investors still trust the bank. My first intention was to mainly base my ranking on their balance sheet, but the balance sheet of SVB, Signature, Silvergate and Credit Suisse was average, it wasn't terrible (Many banks do much worse). In fact Moody's gave SVB an A rating. What broke SVB,Signature and Silvergate's neck was their lack of diversification, their high exposure to crypto and tech startups and the bankrun that ensued when crypto collapsed and VC cut their funding. Almost every bank can't sustain a bankrun. In the "cash equivalents % of total assets" column you can see how much of their assets the bank can actually let people quickly withdraw and it isn't that much. Silvergate had 40% of their assets in cash equivalents, more than almost every bank, and they still failed.