August 8, 2014

2014 World's Strongest Banks

The inspiration for this post came from this intricate Scattering Points in Parallel Coordinates (SPPC) design from Peking University.  One look and I was immediately captivated by its sophisticated complexity.  Joe Mako has also visualized similar multidimensional data with parallel coordinates chart using Tableau.

For this visualization of the world's strongest banks, 8 dimensions were used to form parallel coordinates.  For dimensions Overall Score, Non-Performing Assets to Total Assets, and Efficiency (Costs to Revenues), the lower the value, the higher the ranking.  Whereas for dimensions Tier 1 Capital ratio, Loan-Loss Reserves to Non-Performing Assets, and Deposits to Funding, the higher the value, the higher the ranking.

Let’s interpret the chart (this visualization would benefit more with a larger data population but Bloomberg Markets only released top 20 out of 97 banks ranked).  Asian and European banks account for about 40% each of the top 20 banks, and North American banks, 20%.  In general, Asian and European banks rank higher than North American banks.  The top ranking is Hang Seng bank from Hong Kong, followed by Desjardins Group from Canada and Norinchukin Bank from Japan, both tied at rank #2.


For Tier 1 Capital Ratio, European banks generally have higher ratio, which means they are relatively more well-capitalized than Asian and North American banks.

For Deposits to Funding, European banks have lower ratio, which means they tend to lend more and are less liquid than Asian and American banks.  On another hand, Asian and American banks have higher ratio, which means they lend less and are more liquid.  This might also mean that Asian and American banks might not earn as much as they can compared to European banks.

For Costs to Revenues ratio, Asian banks have lower ratio, which means that they are run more efficiently than European and American banks.

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