Business leaders in Britain rated UK banks a mere 44th in the world for solvency, well behind countries in Africa and Latin America including Senegal, Botswana, El Salvador – and even behind Iceland, whose three main banks have all been taken into national ownership after collapsing into financial turmoil this week.
The United States was rated 40th in the survey of executives around the world on the relative health of their national economies.
Top of the league in the executive opinion survey came banks in Canada, which were awarded a rating of 6.8 out of 7 by Canadian businesspeople. Under the scoring system, 7 is taken to represent banks that are generally healthy with sound balance sheets, and 1 is when banks are felt to be insolvent and in need of a government bailout.
Sweden, Luxembourg, Australia, Denmark and the Netherlands came just behind Canada, on 6.7. Iceland was rated 6.2. The US was rated at 6.1 and the UK 6.0, placing both about a third of the way down the table of 134 countries.
The opinion survey was carried out before recent seismic upheavals in the global financial system, including the UK’s £500 billion rescue scheme for its banks, the international 0.5 per cent cut to interest rates, both announced yesterday, and the US’s proposed $700 billion bank bailout, agreed last Friday.
It does not take into account the dramatic events in Reyjavik in the last week, where the three main banks – Glitnir, Landsbanki and Kaupthing – have all been taken over by the Icelandic authorities.
Algerian banks came bottom of the league table, with a rating of just 3.9. Perhaps surprisingly, Zimbabwean banks came in 122nd with 4.5, above more generally solvent and stable countries as Argentina (129th, on 4.2) and Libya (133rd, with 4.0).
China’s banks came a dismal 108th with a score of 4.9, and Japan’s were rated 93rd, with 5.1, by business people in their respective countries.
The executive opinions on banks was a small section of a general report, which combined opinion surveys with economic data to rank the relative global competitiveness of entire countries. In the report’s overall ratings, the US came top, followed by Denmark, Sweden and Singapore.
“Despite the financial crisis, the United States continues to be the most competitive economy in the world,” the WEF said in its report, out yesterday.
“This is because it is endowed with many structural features that make its economy extremely productive and place it on a strong footing to ride out business cycle shifts and economic shocks.”
Britain had slipped out of the top 10, however, a development which the report said was “mainly attributable to a weakening of its financial markets”.
RANKINGS
1. Canada
2. Sweden
3. Luxembourg
4. Australia
5. Denmark
6. Netherlands
7. Belgium
8. New Zealand
9. Ireland
10. Malta
11. Hong Kong
12. Finland
13. Singapore
14. Norway
15. South Africa
16. Switzerland
17. Namibia
18. Chile
19. France
20. Spain
21. Barbados
22. Bahrain
23. Slovak Republic
24. Brazil
25. Estonia
26. Austria
27. Panama
28. Mauritius
29. Kuwait
30. Qatar
31. United Arab Emirates
32. Trinidad and Tobago
33. Senegal
34. Israel
35. Portugal
36. Iceland
37. Cyprus
38. Botswana
39. Germany
40. United States
41. Lithuania
42. Peru
43. El Salvador
44. United Kingdom
45. Greece
46. Benin
47. Costa Rica
48. Malawi
49. Guyana
50. Malaysia
51. India
52. Puerto Rico
53. The Gambia
54. Montenegro
55. Mexico
56. Croatia
57. Czech Republic
58. Jordan
59. Ghana
60. Suriname
61. Brunei Darussalam
62. Latvia
63. Saudi Arabia
64. Kenya
65. Jamaica
66. Honduras
67. Zambia
68. Burkina Faso
69. Slovenia
70. Sri Lanka
71. Pakistan
72. Philippines
73. Republic of Korea
74. Romania
75. Thailand
76. Madagascar
77. Colombia
78. Cote d’Ivoire
79. Italy
80. Bulgaria
81. Hungary
82. Cameroon
83. Georgia
84. Oman
85. Tunisia
86. Paraguay
87. Nigeria
88. Armenia
89. Morocco
90. Dominican Republic
91. Bolivia
92. Malia
93. Japan
94. Tanzania
95. Moldova
96. Bosnia and Herzegovina
97. Poland
98. Nicaragua
99. Venezuela
100. Uruguay
101. Guatemala
102. FYR Macedonia
103. Syria
104. Albania
105. Nepal
106. Mozambique
107. Russian Federation
108. China
109. Uganda
110. Serbia
111. Egypt
112. Ukraine
113. Vietnam
114. Turkey
115. Bangladesh
116. Azerbaijan
117. Taiwan, China
118. Ecuador
119. Mauritania
120. Mongolia
121. Indonesia
122. Zimbabwe
123. Tajikistan
124. Kazakhstan
125. Cambodia
126. Burundi
127. Chad
128. Ethiopia
129. Argentina
130. East Timor
131. Kyrgyz Republic
132. Lesotho
133. Libya
134. Algeria
Jenny Booth
October 9, 2008
Source: Times Online