The US GSIB’s have emerged stronger and faster from the North Atlantic Financial Crisis than the UK & EUR GSIB’s. The US GSIB’s were the first to release their FY2018 results last week and on the other side of the pond there will be UK & EUR GSIB CEO’s and CFO’s wishing to avoid peer GSIB results comparisons.
So how high has the bar been set …too high, by a long way. See link for analysis
Key highlights:
Returns on Equity and Tangible Equity are above Cost of Equity (≈10%) for all US GSIB’s who are benefitting from continuing domestic economic growth, lower effective tax rates and strong core business focus.
Core Equity Tier1 ratio’s peaked in the last 2 years and are above med term target levels with room for minor downward adjustments
Supplementary Leverage Ratio’s are >6% for all US GSIB’s ahead of this years CCAR stress tests
Efficiency is being improved by all US GSIB’s and for those with Cost to Income Ratio’s > 65%, it is arguably their highest priority
Net Payout Ratio’s remain high but in some cases below medium term targets as new investment opportunities are seized.