The FT Banker Database identifies approximately 3,400 banks globally. Based on the criteria that we assess, the banks that we monitor are (with one or two exceptions) in the top percentile of the global banking universe. Our Scorecards cover all 30 banks that are categorised as Global Systemically Important Banks (G-SIBs), plus a small number of banks that are Domestic Systemically Important Banks (D-SIBs) and / or known issuers of retail structured products, including a number of institutions that some issuers credit-link their products to.
A number of metrics are widely considered relevant in assessing financial strength and credit risk. Our Scorecards cover 27 ‘factors’ across 5 ‘categories’:
- FACTORS: Each of the 27 factors generates a score, ranging between 1 (best) and 10 (worst).
- CATEGORY SCORECARDS: Each of the factors is attributed a weighting within the category: and the weighted factor scores are combined to produce individual Category Scorecards, also with a score ranging between 1 (best) and 10 (worst).
- AMALGAMATED SCORECARD: All of the Category Scorecards are combined to produce the Amalgamated Scorecard – with weightings based on our view of the relative importance of the various categories / factors in assessing financial strength / credit risk.
The Amalgamated Scorecard produces a score out of 1,000. A low score is best, indicating a potentially stronger issuer / counterparty. A high score is worst, indicating a potentially weaker issuer / counterparty.
We attribute a colour to each issuer / counterparty, to identify their quartile ranking in the Amalgamated Scorecard. These colours are retained by the issuers / counterparties across each of the Category Scorecards, so that it is possible to see, at a glance, how an institution scores within each category compared to their position in the Amalgamated Scorecard:
Please see the presentation pack for ‘Methodology: scoring and weighting’ for full details of the methodology for our Scorecards.