Most Western European banks had an exceptional 2023, as higher interest rates boosted lending margins. The resulting increase in net interest income was the main driver of a broad-based surge in European banks’ profitability over the year, enabling them to earmark more than €120 billion (about $128 billion) to distribute to shareholders through a combination of higher dividends and share buybacks. With their strong franchises, the largest banks have led the way in this, as they are best placed to maintain their profitability when the interest cycle turns.

The digital transformation of Europe’s banks gained momentum last year, with practically all banks reporting record numbers of new digital customers, transactions, and logins. As part of upgrading their general banking apps to make them more interactive and personalized, European lenders are increasingly looking to artificial intelligence and other emerging technologies to achieve transformative change.

As leading banks strengthened their climate change commitments, sustainable financing also increased globally. The year saw banks undertaking more sustainable lending and green bond issuance while decarbonizing their legacy loan portfolios. They are also introducing more targeted sustainable savings and investment products and new ways of helping their customers through the green transition.

CaixaBank has once again won our awards as Best Bank in Western Europe and in its home country, Spain. The awards recognize the bank for its strong financial performance following the integration of Bankia consequent on the 2021 merger, its ongoing leadership in digital innovation, and its commitment to society through the La Caixa Foundation. Profits were up 54% to €4.8 billion, while gross income grew by 28%.

Throughout 2023, CaixaBank supported its retail and business clients by financing their projects and managing their savings via its business model committed to financial inclusion and support for the most vulnerable segments of society.

Core revenues were up 31.6% to €15.1 billion in the year, primarily driven by net interest income—up 54% to over €10 billion. Insurance services also saw strong growth (up 19.6%), while gross income from equity investments rose by 26.4%. Meanwhile, the bank’s cost-to-income ratio improved, falling to 40.9%, a 9% drop from the previous year.

During a highly challenging 2023, the bank witnessed healthy commercial activity and granted 280,000 loans and 80,000 retail mortgages.

CaixaBank also saw positive net inflows to mutual funds, savings insurance, and pension plans, up 34% on the year. The bank boasts strong liquidity and capital buffers, with €160.2 billion in liquid assets. Its return on equity (ROE) was 13.2%, and the common equity tier 1 (CET1) ratio was 12.4% at the end of the year.

This year’s winner in Italy, UniCredit has seen a remarkable turnaround in its performance in recent years, as the bank has implemented its “UniCredit Unlocked” strategy. The results are tangible, with group net profits up over 50% to €8.6 billion. Within Italy, total revenues were up 19.4%, and operating profit increased by 36.5%.

Much of this turnaround is credited to CEO Andrea Orcel, who took the helm in 2021 and oversaw nonstop profitable growth through the fourth quarter of 2023 and, more recently, oversaw the bank’s UniCredit Unlocked transformation plan.

The bank’s net revenue growth, cost discipline, capital efficiency, and investments contributed to its 16.6% return on tangible equity (ROTE). At the same time, UniCredit’s asset quality and defensive strategy resulted in a CET1 15.9% ratio, which put the bank in a strong position during uncertain times.

The winner as the Best Bank in Germany, Commerzbank continued its dramatic turnaround story. The bank celebrated its best result in 15 years, with net profit up more than 50% to €2.2 billion. Strong customer business and interest rate developments led to solid net interest income, while revenues increased to €10.5 billion.

Its Strategy 2024 plan met, and sometimes exceeded, significant milestones ahead of schedule. More ambitious goals have been added for its new Strategy 2027, such as expanding its revenue base to be less dependent on net interest income.

Commerzbank acquired a majority stake in Hamburg-based Aquila Capital Investmentgesellschaft in January of this year, expanding the bank’s sustainable asset management offerings.

The bank’s nonperforming loan (NPL) ratio stood at a very low 0.8%, and its CET1 ratio rose to 14.7% at year-end 2023.

The Best Bank in Austria winner, BAWAG Group had a strong year with core revenues up 16% and net profitability 34% higher. The bank extended its reach beyond the home market with its recent acquisition of Knab, which will expand BAWAG’s footprint in Dutch banking for small and midsize enterprises (SMEs) and retail. Last year, BAWAG also acquired Peak Bancorp, the holding company for Idaho First Bank, with the aim of growing the bank’s community-focused retail and SME business in Idaho and adjacent markets.

It was a strong year for the bank, with a net profit of €683 million and a return on average tangible common shareholders’ equity of 25% despite a subdued market.

BAWAG ended 2023 with a CET1 ratio of 14.7% and €475 million in excess capital, slated to be reinvested into the bank. Meanwhile, its customer deposits and funding were up 4% and 6%, respectively, while the bank’s NPL ratio stood at 1%.

ING, a market leader and our winner in the Netherlands, added 750,000 primary retail customers over the year to reach 15.3 million. The bank’s launch of its Everyday Roundup digital offering in the Netherlands continues to attract new customers. Retail banking fee income increased through higher fees for payment packages and growth in assets under management (AUM).

As part of ING’s commitment to assist sustainability transition, it increased its sustainable finance from €101 billion in 2022 to €115 billion in 2023.

The bank’s profits nearly doubled to €7.3 billion, and its year-end ROE and CET1 ratios were 14.8% and 14.7%, respectively, fueled by its robust retail and wholesale banking lines, higher interest income, and quality assets.

BNP Paribas Fortis, again the winner as Best Bank in Belgium, spent 2023 overcoming the logistical challenges of migrating 3 million customer accounts following the merger with bpost bank completed at the beginning of this year. At the same time, it delivered strong revenue growth of 9.1%, a 9.4% growth in net banking income of €10.6 million compared with 2022, and a 16.2% year-end CET1 ratio.

Last year also saw a 14% increase in digital contacts via the bank’s Easy Banking App and the Easy Go and Easy Guide modular packs launched to improve customer multichannel access.

Spuerkeess (BCEE), the winner in Luxembourg for the third time, has been wholly owned by the State of Luxembourg since its foundation in 1856. It is widely known as Banque et Caisse d’Epargne de l’Etat (BCEE). Today, it is the market leader for retail banking services in Luxembourg, with a 47.3% overall market share and a 51% share of the domestic mortgage market. The bank reported a semiannual net profit of €220 million, up 24.4% compared with first-half 2022. Its strong capital buffers are reflected in a CET1 ratio of 22%.

As part of its internal transformation program, the bank announced this year a new partnership with Euroclear’s funds platform to centralize its funds’ distribution and execution services.

UBS, which wins this year’s Best Bank in Switzerland award, posted an underlying pretax profit of $29.9 billion, including $28.9 billion of negative goodwill from last year’s Credit Suisse acquisition, and a 14.5% CET1 ratio. Since the acquisition, UBS has gained $77 billion in net new assets while stabilizing and integrating the latest business. The bank plans to restructure and optimize the consolidated results.

This year’s best bank in Liechtenstein is LGT, the international private banking and asset management group owned by the Princely House of Liechtenstein. LGT enjoyed another very strong year as AUM rose 10% to 316 billion Swiss francs (about $345 billion), the highest year-end level in its history.

Net new money inflows of CHF 21.9 billion corresponded to an 8% growth while operating income increased by 11%. In addition to organic growth through net new money, LGT’s acquisition of Abrdn Capital’s UK wealth management business contributed CHF 6.4 billion for the year. LGT provides expertise, expanding digital offerings, an international presence and a stable business model that continues to attract new clients.

Our winner in Monaco CFM Indosuez Wealth Management is one of the principality’s largest banks and one of only two Monegasque companies listed on the Euronext Paris stock exchange. Consolidated group revenues increased by 23% to €197 million, while the bank’s overall operating profit of €77.5 million compares favorably to €55.6 million in the previous year.

The wealth manager recently launched its “Work creates wealth” campaign, aimed at younger English-speaking clients representing less than a third of its customer base. CFM Indosuez Wealth Management has seen an increase in its online banking clientele but knows that human relationships remain extremely important.

HSBC wins our award for Malta on the back of record results. Profit before tax was up an impressive 141% to €133.9 million, driven primarily by increasing net interest margins and higher earnings from HSBC’s insurance subsidiary. ROE of 17.1%, compared to 7.7% for 2022, was the best for a decade.

The bank benefited from stronger customer relationships and an increasing net interest income. At the same time, it leveraged its international footprint and maintained its robust risk management culture.

It made further progress in reducing costs, with the bank’s cost-efficiency ratio down to 44% compared with 68% the previous year. Capital and liquidity ratios were well above regulatory requirements, with the CET1 ratio rising to 20.6% at the end of 2023.

Bank of Cyprus wins the title, having achieved an extraordinary improvement in its profitability over the past year, with post-tax profit surging to €487 million compared to €57 million in 2022. The bank benefits from a diversified income stream; and its insurance companies, Eurolife and GI, are leading players in Cyprus’ life and general insurance business. The net insurance result for the year was up 20%.

The well-capitalized institution delivered a ROTE of 24.8%, which surpassed its 2023 targets, and a year-end CET1 ratio of 18.7%. The bank also maintains a highly liquid balance sheet, with €9.6 billion placed at the European Central Bank.

The winner in Greece, Eurobank, is firing on all cylinders, with core operating profit before tax up by 69.4%. Its net interest income rose by 46.9 %, while net fee and commission income was up 4.2%, resulting in core income growth of 35.8% over the previous year.

The better-than-expected performance continued, with its nonperforming exposure dropping to 3.5% from 2022’s 5.2%, and its CET1 ratio reaching 17% at the end of the year. Eurobank ended 2023 with an annual €1.8 billion increase in its loan book, with a fifth of disbursements allocated to green loans.

The bank is engaged in a customer service enhancement program to improve customer accessibility at every point of contact. Retail banking staff are given sign language training to serve customers with hearing disabilities through video calls. For customers with total or partial visual impairment, the bank is installing voice guidance at over 800 ATMs across Greece.

Founded in 1950 and currently with €22.2 billion AUM and €43 million profit based on its latest published accounts, this year’s winner in Andorra is the market leader Credit Andorra, which has now adopted the brand name Creand. The acquisition of Vall Banc in 2022 and its subsequent integration have strengthened the bank’s leadership franchise in retail and private banking in the principality, the sixth-smallest state in Europe.

A new agreement this year with Onyze, a leader in digital asset custody, will allow the bank to offer its clients crypto-asset buying and selling services through Creand Wealth Management.

North of the Pyrenees, Credit Agricole takes the Best Bank in France award. The bank reported a record net income of €8.25 billion in 2023, a 3.3% improvement over the previous year, and also a ROTE of 12.6%.

Its asset management business saw strong inflows of €26 billion, while corporate and investment banking posted a record performance. Private banking and asset servicing increased in scale following the purchase of Belgian private bank Degroof Petercam and the July 2023 acquisition of RBC Investor Services’ European operations.

In January of this year, the bank acquired a 7% minority stake in payments-technology company Worldline. Credit Agricole and Worldline recently launched CAWL, an all-in-one payment offering for merchants in France.

The return winner in Portugal, Banco Santander Totta, increased its net profit last year by 57.3% to €895 million, with net income from banking activities rising by 51.5% to close to €2 billion.

The bank’s commercial and digital transformation drove profits in 2023. Its client base continued to increase, adopting the bank’s digital offerings, leading to a more than 25% increase in access via its digital channels. Last year, customer transactions were up 12.9%, while digital customers grew by 6%. Net customer subscriptions to investment funds and financial insurance products led to a portfolio growth of 11.1% compared to the end of 2022. Banco Santander Totta also ended the year with a CET1 ratio of 16.9%.

Lloyds Bank, a repeat winner in the UK, put in another strong performance. Net income rose by 3% to £17.9 billion (approximately $22.4 billion), driven by a 5% increase to £13.8 billion in net interest income. Other income increased by 10% overall, driven by growth in retail, commercial banking, insurance, pensions, and investments. Lloyds’ CET1 ratio of 13.7% is ahead of the bank’s revised target of around 13%.

New products included mobile-first mortgage onboarding, Lloyds Bank 360 for the mass affluent sector, and a digital invoice finance platform for digitizing the SME portfolio. Following its acquisition of Tusker, a UK market leader in managing and leasing electric and ultralow-emission vehicles via salary sacrifice schemes, Lloyds Bank currently finances one in eight ultralow-emission vehicles on the UK road network.

Returning to majority private ownership in 2023, AIB (Allied Irish Bank) takes home the title of the Best Bank in Ireland. The bank delivered a solid financial performance, with a profit after tax of €2 billion, while its total income increased by 64% to €4.7 billion.

The year also saw AIB end its 2021-2023 strategic cycle, which delivered an enhanced suite of products and services to its record 3.3 million clients. AIB is a green-lending leader in the Irish marketplace, accounting for 30% of its total €12.3 billion of new lending in 2023 and environmental, social, and governance (ESG) bonds, where AIB has issued €5.75 billion bonds to date.

The winner in Denmark, Danske Bank has dramatically improved its profitability, posting a net profit of 21.3 billion Danish kroner (about $3 billion) compared to a loss of DKK 4.6 billion in 2022.

Higher interest rates, better-than-expected macroeconomic conditions, and strong commercial momentum contributed to a total income of DKK 52.4 billion. Operating expenses were down 4% overall, and the company ended the year with an 18.8% CET1 ratio.

In January of this year, Danske Bank entered into an agreement with Backbase, a fintech company, to provide access to the Backbase Engagement Banking Platform as part of its improved digital customer experience.

Farther north, the winner in Finland and Sweden, Nordea, had a strong 2023 despite a weakened economic environment. The bank maintained good business momentum and delivered solid financial results. Its full-year ROE increased to 16.9% from 13.8% in 2022.

The use of Nordea’s digital services rose significantly, up 13% on the year and reaching a record high of 1.4 billion logins. Emphasizing its omnichannel customer approach, Nordea also held more than a million client advisory meetings over the year, up 9%.

In Finland, Nordea saw total income in personal banking increase by 29% and net interest income rise by 46%. In business banking, net interest income increased by 33%, driven by improved deposit margins.

Meanwhile, in Sweden, Nordea’s total income increased by 9% in local currency, with net interest income growth of 8%, while net fee and commission income rose by 9%. Additionally, Nordea Group’s AUM grew by 5% to €378 billion, and the CET1 ratio was 17% at the end of 2023.

Our winner for Norway is DNB, where profits were up 18% to 39 billion Norwegian kroner (roughly $3.5 billion) in 2023. The bank performed well across all customer segments, with a substantial contribution from the corporate market and international offices. An increase in transaction volume of 20% made DNB Norway’s leading transaction bank for the year. Competing against more than 100 domestic banks, DNB delivered substantial year-end numbers with an ROE of 14.6% and a CET1 ratio of 18.2%.

Landsbankinn, the winner as Best Bank in Iceland, ended 2023 with a leading 40% retail market share. The country’s unique geography renders robust digital offerings vital.

Sustainability is another key customer demand, and green funding now accounts for 46.5% of the bank’s nondomestic funding and 26.6% of total borrowing. For the fifth year in a row, Landsbankinn topped the Icelandic Performance Satisfaction Index for banking customers and reached its highest-ever market share in retail banking at over 40% by the end of the year.  

Market volatility and sharply higher interest rates had the biggest impact on European private banks’ performance over the past year. Overall, the results were mixed. Adverse market conditions drove assets under management (AUM) from their 2021 peak, although this was partly counterbalanced by a modest increase in net new money from clients. Practically all private banks reported that fee and commission income dropped sharply, alongside gains from improved lending margins.

The question is how long the aforementioned tailwinds will continue to affect profits in the face of rising costs across the industry. Europe’s private banks face a pressing need to invest further in technology if they are to address both new regulatory requirements and clients’ rapidly shifting needs.

Balancing increased IT spending while sustaining profitability will be crucial in the coming years. Several major European banks have already shuttered their private banking units, such as ABN Amro’s Asia-Pacific units and Lloyds’ Swiss business—and further consolidation is expected.

The eurozone’s leading private bank by AUM and the clear market leader in its core French and Benelux markets, BNP Paribas Private Bank has benefited from a 48% surge in net new money and higher interest margins over the past year.

Thanks to its ability to leverage groupwide technology upgrades, the unit has achieved significant synergies, resulting in an 8% boost to its overall profitability. The bank has focused on accelerating its move upmarket, developing an increasingly sophisticated offer, including credit structuring and tailor-made financing packages, that caters to the needs of its wealthiest customers.

Recognized as a regional leader in client-focused platforms and in digital channels that provide personalized communication between manager and client, BNP Paribas recently launched a portal dedicated to alternative investments, including private equity and debt.

BBVA is ahead of the curve in meeting the EU’s strict Sustainable Finance Disclosure Regulation, having launched a digital channel for regulatory compliance, tracking clients’ sustainability risk data so they can adjust their exposures accordingly.

The bank is also increasing its offering of sustainable alternative investments. Private clients can now secure better mortgage terms if the property in question has a high energy-efficiency certification. The same goes for BBVA’s consumer loans, which feature better rates when used to purchase electric or hybrid vehicles.

BBVA emphasizes sustainability as central to its client offering. Many of its pension fund clients are deeply committed to sustainability. The bank now offers them multiple investment solutions incorporating environmental, social, and governance (ESG) criteria. Several of BBVA’s in-house mutual funds, moreover, are committed to impact-investment strategies; and all its private bankers are now required to hold an external sustainability certificate.

BNP Paribas’ private banking unit has prioritized facilitating its customers’ transition to higher-end services, and new technology precisely targeted at individual clients’ needs is central to the effort.

Already recognized as a leader in developing client-friendly platforms that offer a unique personal communication channel between the private bank and its clients, BNP recently launched a dedicated digital portal for private equity and debt investors.

On top of a broad range of investment options managed in-house, the bank has also embraced innovative tie-ups with third-party specialists to provide digital solutions. These include MyMand@te, a discretionary portfolio management offering; Mon Demain, a platform dedicated to retirement preparation; a carbon-footprint calculation engine developed with Greenly, a climate software developer; and an innovative digital safe with Cecurity, a developer of software designed for secure exchange and archiving of electronic documents.

Tailoring offerings, services, and performance to cater to a diverse clientele ranging from those with established fortunes to emerging tech magnates and the next generation demands a blend of expertise and vision. It also requires an ability to see past headwinds and help clients plot a long-term course.

This year has been a singular year for private banking, as providers watched the almost simultaneous fall of one of the largest private wealth managers in history, Credit Suisse; and one of the most innovative, Silicon Valley Bank (SVB). Despite which, the industry has shown resilience as historical powerhouses such as J.P. Morgan, UBS, Deutsche Bank, Citi, and Bank of America stepped up to prevent a financial crisis in the wake of the collapse of SVB, Signature Bank, and First Republic Bank—later reaping the rewards, increasing their clientele, staffing, and structural capacities.

Moreover, J.P. Morgan Private Bank kept improving its offerings and global presence. This year, it opened a new US Family Office Practice and added to its teams in Asia and Latin America while making changes in upper management in both regions.          —TM

Westpac Private Bank acts on the belief that commitment to diversity begins at home. The Australian market leader has set specific targets for gender representation within its leadership ranks, with the aim of filling 50% of leadership positions and at least 40% of board seats with women.

In March, the bank introduced a set of initiatives to support female entrepreneurs as part of its 500 million Australian dollar (about $318 million) commitment to women in business. The initiatives include offering startup loans of up to AU$50,000 with a three-year tenor and providing scale-up loans of up to AU$1 million to assist existing businesses in their growth, also with a three-year tenor.

“Boosting women’s entrepreneurship in Australia is important to the economy,” said Chris de Bruin, who has since stepped down as group chief executive of consumer and business banking, in commenting on the initiatives. “The longstanding gender pay gap represents a missed opportunity for innovation, social and economic value creation, and job creation.”          —Jonathan Rogers

DBS initiated its digitalization journey in 2014, with the aim of developing artificial intelligence (AI) and machine learning models and utilizing cloud and open-source technologies to facilitate a transformation into a fully digital bank.

Since then, the Singapore-based bank has achieved several breakthroughs in the field, reducing costs by 30 million Singapore dollars (about $22 million) while increasing revenue by SG$180 million.

Among the most important developments are an internal self-service AI platform, an AI protocol, and a knowledge repository, enabling rapid AI deployment at scale. DBS’ integration of its relationship management systems with AI, referred to as the “phygital” (hybrid physical and digital) dynamic, has also played an important role in delivering optimal client service to its private banking clients.    —JR

Having been the top-rated bank on the Dow Jones Sustainability Europe Index three years in a row, BBVA is an undisputed global leader in the field. The Spanish giant’s success rests on two pillars: alignment of all loans and investments with the Paris Agreement and a comprehensive range of sustainable products and services for the bank’s clients.

BBVA offers a family of sustainable mutual funds whose managers are committed to impact investing. It also constantly monitors the environmental, social, and governance (ESG) credentials of third-party funds through its proprietary Quality Funds platform. Sustainability-risk information goes digitally to private banking clients in compliance with the EU’s Sustainable Finance Disclosure Regulation. Finally, to ensure that its clients have confidence in its commitment, BBVA now requires all of its private bankers to hold an external sustainability certificate. —Jonathan Gregson

BTG has built an investment-solution ecosystem that aims to meet all of its wealth management clients’ medium- and long-term goals with an integrated, one-stop-shop approach. The platform leverages cutting-edge technology and up-to-date analytical information, enabling BTG’s team to upgrade clients’ financial experience into a user-friendly, easy-to-navigate environment.

One of the main features is constant dialogue with clients over their developing needs. For this, BTG focuses on three vital aspects: recruiting and nurturing top professionals for the front, back, and middle office and product areas; deepening its understanding of clients’ financial needs and objectives; and staying ahead by anticipating global and local market opportunities, especially during challenging periods.            —Estela Silva

Reliability, investment performance, and tailor-made solutions are requisites for high net worth (HNW) and ultrahigh net worth individuals (UHNWI) shopping for a private bank. Banque Richelieu Monaco, which takes home our award this year as Best Boutique Private Bank in the World, checks all of these boxes, along with above-average staffing and growth of assets under management (AUM).

With nearly 40% of its AUM base landing in the UHNWI category, Richelieu maintained its focus on offering rapid, tailor-made decision-making, enabling clients to navigate wealth management seamlessly. It was rewarded with stellar growth this year, as AUM grew 17% and net profits an impressive 47%.

Richelieu’s strategic focus encompasses markets including Monaco and other European countries, which account for 60% of AUM; while Africa, Asia, the Middle East, and the US account for the rest. Nonetheless, it has kept on building foreign partnerships, notably with Banque Richelieu GCC in Cyprus and Abu Dhabi. A recent collaboration with banking and wealth management software developer ERI has enabled the bank to improve efficiency and upgrade its technology offerings, improving client service.  —TM

Hana Private Bank has made a name for itself as an innovator by offering new digital assets, accessible and manageable on Hana’s 1Q Bank app, to its HNW clients. The new products include security token offerings and fractionalized stakes in blue-chip artworks by artists such as Picasso, Warhol, Kusama, and Basquiat using nonfungible tokenization backed by blockchain technology.

The South Korean bank established Hana Art Bank in July 2023 in alliance with an alternative investment platform company to appeal to “microcollectors” via fractional ownership.

Hana teamed with KPMG in February to launch two more new offerings: succession planning services, including valuation and M&A advisory; and a private community linking younger HNWIs with CEOs for networking and business-opportunity creation.          —JR

J. Safra Sarasin sees sustainability as the most critical aspect of its approach to socially responsible investment. The Swiss private bank has closely integrated two key sets of standards: the Paris Agreement on climate change and the UN’s Sustainable Development Goals. Both are embedded in Safra’s corporate strategy and core investment offering.

Safra has been ahead of the curve since it launched its first sustainable investment mandate in 1989, and it has consistently directed resources to companies that embrace energy efficiency and decarbonization. A founding signatory of the UN Principles for Responsible Investing in 2006, Safra launched its own proprietary Sustainability Matrix more than 20 years ago and today requires that all of its mandates be sustainable. —JG

As the private banking world buckles up to help manage one of the most significant generational wealth transfers in history over the next couple of decades, BTG Pactual Wealth Management is working to stay ahead of the pack. The bank’s Future Leaders program is dedicated to preparing heirs for roles in shaping future legacies through comprehensive education in legal, economic, and tax aspects of estate planning.

Recognizing the pivotal role women will play in guiding the next generation of wealth management, BTG also offers Financial Journey–Women Investors, a financial education and leadership initiative aimed at helping participants make informed financial decisions and explore diverse investment strategies.     —ES

Managing approximately $1.3 trillion across the globe, Scotiabank has evolved into a powerful worldwide force. Since 2018, the Canadian bank has grown and diversified on the back of a series of multibillion-dollar acquisitions in areas including asset management and foreign exchange hedging.

Intergenerational wealth transfer and transition services are central to Scotia Wealth Management’s Enriched Thinking offerings. Scotiabank backs these up with the stability of its Canadian operations and its expertise across the globe. This helps entrepreneurs facing uncertainty in their home country to invest in more-secure markets.

A tailored fee structure helps Scotiabank to create a more customized practice with each of its business clients, backed by a five-year program that identifies customer needs and delivers solutions in one plan. Thanks to this approach, Scotiabank’s commercial banking business has seen sixfold volume growth in referrals over the past six years, to $13 billion.       —Nic Wirtz

Combining a deep knowledge of local markets with best-in-class global capabilities, Fifth Third Private Bank won high marks this year for service to entrepreneurs amid a volatile global economy. Its team of senior strategists, CPAs, and attorneys combined to produce a financial advisory offering that earned Fifth Third outstanding numbers in its customer satisfaction survey.

The bank continued to improve its tailored offerings to business owners. Last year, it partnered with a group of universities across the US on an exclusive survey aimed at understanding the strategies that middle-market business owners use in planning and executing transitions. The research yielded insights into the hurdles facing wealth managers in this market segment, particularly in the post-pandemic landscape, prompting further improvements in Fifth Third’s offerings.          —TM

With dedicated teams spread across Western Europe, Switzerland and the US, Santander Private Bank has expanded its client base of family offices by 16% over the past year to 3,090 families globally.

Recognizing the unique needs of UHNW clients, the Spanish-based bank recently introduced a team focused on offering a comprehensive suite of strategic investment banking solutions for family offices. Santander’s flagship Private Real Estate Advisory (SPREA) program helps UHNW clients identify promising investment opportunities and efficiently execute transactions. SPREA has dedicated teams in key regions, including Spain, the US, Portugal, Mexico and Brazil.

This strategic positioning allows the bank to tap into cross-border investment flows between the continents on which it operates. In 2022 alone, SPREA enjoyed 20% YoY growth in net revenue while overseeing €321 million (about $343 million) in total transaction value, underscoring its success in serving UHNW clients’ real estate investment needs.  —ES

Emirates NBD is becoming more and more of a global bank. The Dubai-based bank has developed a strong network in emerging markets from Africa to Asia, with a presence in Egypt, Turkey, Bahrain, Russia, Singapore, Indonesia and China.

In 2022, the bank opened two additional branches in India to complement its Mumbai offices. It also expanded its network in Saudi Arabia, the Middle East’s biggest market, with a booking center and 13 branches.

In these countries, Emirates NBD offers first-class private banking services but is also leveraging its ability to act as a bridge institution facilitating wealth transfers and providing investment solutions to large expatriate communities from the Global South.

Adapting to youth and new technologies, Emirates NBD also operates Liv, a digital bank, and just launched ENBD X, a new mobile app with an embedded digital wealth platform that allows clients to access over 11,000 global and regional equities with just a click.     —Chloe Domat

The initial success of this strategy is reflected in the bank’s excellent financial performance, which underscored the resilience of its balance sheet. Notably, the Federal Reserve’s annual stress test reaffirmed PNC’s financial strength and stability across economic cycles even while other banks faced difficulties.

As its rivals stuck to the basics, PNC focused on environmental responsibility and economic empowerment through private bank inclusion, committing more than $1 billion to bolstering African American–owned businesses in underprivileged communities and comprehensive sustainable investment offerings.     —TM

The Netherlands’ leading bank, which has long provided bespoke private banking-style services to its wealthier clients, recently lowered its entry threshold to €500,000. Given that this is by far the fastest-growing segment of the private banking market, the move has yielded healthy growth in a challenging year.

ING’s new cutoff point is part of a broader strategy of guiding existing clients into more value-added services. The bank currently fields a team of 450 advisers and investment specialists furnishing a full range of discretionary, advisory, and execution-only services to the rapidly expanding clientele.

The bank differentiates between clients, says Katja Kok, head of Private Banking and Wealth Management, Netherlands. The advice on financial planning and asset management needed by an individual with €5 million in assets is “perhaps even more relevant for someone with an invested capital of €500,000,” she says.      —JG

Bradesco Global Private Bank is working to grow its HNW and UHNW client base by focusing on the midmarket. To appeal to prospective customers with a net worth ranging from $1 million to $24 million, the bank is increasing its international offering, promoting better services for multinational Latin American fortunes.

Since 2020, that strategy has including acquiring other providers, including the Brazilian private banking operations of JP Morgan and BNP Paribas, further cementing its position with the country’s inbound transnational wealth.

It is also pushing into US market, building on its 2020 acquisition of Coral Gables–based BAC Florida Bank. Bradesco aims to bridge the gap for US-based Latin American customers in search of a trusted brand to manage their transnational fortunes.   —ES

Catering to one in four of the world’s billionaires—nearly 15,000 HNW and UHNW clients in over 130 countries, and more than 1,700 family offices—Citi Private Bank’s strong position helped it weather the year’s challenging conditions, including higher interest rates and geopolitical tensions.

As a division of Citi Global Wealth, Citi Private Bank maintains clear strategic priorities, focusing on the high end of the UHNWI market and clients whose net worth exceeds $25 million. That concentration helped the bank to achieve robust client growth in 2023, adding over 900 new clients representing a 21% increase over the previous year, a new record for the bank. The average net worth of Citi newcomers rose as well, by 12% to $450 million. That growth spurt gives Citi Private Bank a total of $461 billion in client assets, an 11% increase from 2022. Despite the adverse market environment, total revenue remained steady.         —TM

Global Finance: What were the main drivers of CaixaBank’s performance in 2022?

Gonzalo Gortázar: 2022 was an outstanding year in terms of commercial activity, credit quality and financial strength. This is especially notable as it happened in the period in which we completed the integration of CaixaBank and Bankia, the largest in the history of the Spanish banking system.

CaixaBank’s commercial activity posted strong growth. Business volume grew to 2% ex-markets, with strong progress in loan production, while revenue from banking activity increased by 5.8% and recurring expenses were 5.6% lower, thanks to cost synergies brought about by the integration. We also closed the year with a very strong balance sheet. Our NPL ratio was down to historic lows, while liquidity, solvency and coverage ratios ended the year at high levels, well above supervisory requirements. CaixaBank’s balance sheet has been at its best position in the past 15 years. It allowed us to substantially increase our shareholders’ remuneration and, thus, the contribution to the “la Caixa” Foundation Welfare Programme.

As a result, we started 2023 in a solid position to capture growth opportunities and support the economy, even in an uncertain landscape.

GF: What has been the impact of the Bankia merger, and how is its integration progressing?

Gortázar: Two years after its closing, I can say that the merger was a success. We successfully planned and executed a very complex integration—because of its scale—in record time and with high standards, while continuing to offer a high-quality service to all our customers.

In just 15 months, CaixaBank was able to complete the full integration of teams, technology platforms and business models.  As a result, the bank is moving at full speed, and we have captured significantly more cost synergies than expected and a year ahead of the plan. We announced 770 million euros [$849 million] of savings by 2023, and we will capture €940 million savings, the bulk of which has already been booked in 2022.

Now that the integration is completed, CaixaBank is clearly the leading financial group in Iberia, with the capacity to provide top-quality financial and insurance services to more than 20 million customers and a unique positioning to continue growing.

GF: How is CaixaBank building digital leadership, and what new areas is it investing in?

Gortázar: CaixaBank continuously invests in innovation because it forms a vital part of our strategy. Digitalization of processes, products and services is applied to all segments and business areas to improve our client experience, broaden our business models and better meet our customer needs by quickly adapting to changing needs. Internally, we understand technology as an enabler to improve our IT infrastructure’s flexibility, scalability and efficiency, improving our internal processes and management capabilities, and as a powerful tool to better manage complexity in critical processes.

In this digitalization process, CaixaBank is also implementing, where appropriate, cutting-edge new technologies, such as quantum computing, blockchain and AI, while continuously enhancing our infrastructures and capabilities of data, advanced analytics and cloud architecture.

GF: Looking ahead, what are the key challenges and opportunities?

Gortázar: The economic backdrop is now more uncertain than last year, with lower growth and higher inflation. On the other hand, interest rates have returned to a more ordinary level after more than six years below zero; this temporarily helps our interest margin and puts pressure on asset quality and cost of risk. Finally, the impact of digitalization and the change in customers’ behavior remain underlying challenges for the sector, as it is based on information and service.

CaixaBank is uniquely well positioned to face the challenges and to focus on the opportunities identified in our Strategic Plan 2022-2024: boost business growth, make progress in specializing by segments, and optimize service models and digitalization to offer the best customer experience at the most efficient cost. We offer our value proposition through an omnichannel service model, combining a wide physical presence with strong, innovative digital capabilities.

We assume that financially sound banks with a social commitment at their core will prosper, and CaixaBank is an example of such a bank.     

Most of the world’s leading banks successfully navigated the geopolitical and economic challenges of 2022. These included Russia’s invasion of Ukraine and the resulting international sanctions, spikes in energy and food prices, the negative impacts of a strengthening US dollar on emerging economies, and inflationary pressures that prompted central banks to push through a rapid series of interest rate hikes.

Initially, banks benefited from higher base rates, increasing their margins and generating higher income. As they also continued to tamp down on costs, largely thanks to enhanced efficiencies that come with the digital transformation of internal processes and client relationships, their profitability rose sharply. Indeed, many of our winning banks reported record financial results for last year and rewarded investors with share buybacks and higher dividend payments.

They also invested in a sustainable future. Within their businesses, they did so mainly by accelerating the drive toward further digitalization of processes, products and services and by applying cutting-edge technologies that include artificial intelligence and quantum computing where appropriate. Similarly, more banks have been migrating their internal processes from legacy on-site to cloud-based facilities.

But many leading banks also increased their efforts to achieve a more sustainable future for society and the planet. During 2022, they increased the choice and scale of their sustainable offerings to investors while at the same time moving more rapidly toward aligning their portfolios with globally recognized environmental, social and governance sustainability goals.

Meanwhile, most leading banks continued to strengthen their capital buffers. Credit quality improved; the proportion of nonperforming loans declined; and liquidity and capital ratios were, as a rule, strengthened. However, recent turmoil in a few specific corners of the industry prompted bank runs and raised broader questions about the role and viability of global banking.

Financial regulators and central banks acted promptly to stem the panic, extending guarantees to non-insured depositors, opening liquidity windows and forcing bank mergers through at breakneck speed. However, these methods have raised questions about the moral hazard and the accepted order of seniority of bond and equity holders. More important, all this has prompted questions over whether regulators will impose stricter and more-widespread stress testing on banks along with higher capital and liquidity requirements. Also, the banking industry’s mutual insurance schemes will likely be reinforced to protect vulnerable banks and their depositors.

All of this has a cost. The return to historically standard interest rates has boosted income and profitability for most banks. But from here on, regulatory or prudential requirements mean banks are likely to rein in lending, thereby putting a brake on economic activity. This credit-tightening cycle puts greater pressure on customers and feeds through to poorer asset quality and higher cost of risk. Lower business volumes, combined with higher provisions and capital costs, will almost certainly prove a serious brake on banks’ profitability in the immediate future. As a result, few bankers expect 2023 to be another vintage year.

With input from industry analysts, corporate executives and technology experts, Global Finance editors select the winners for the Best Bank awards using the information provided in entries and independent research based on objective and subjective factors. It is unnecessary to enter to win, but materials supplied in an entry can increase the chance of success. In addition, entrants may provide private details.

Judgments are based on performance from January 1 to December 31, 2022. Then, we apply an algorithm to shorten the list of contenders and arrive at a numerical score, with 100 equivalent to perfection. The algorithm incorporates criteria weighted for relative importance, including knowledge of local conditions and customers, financial strength and safety, strategic relationships, capital investment, and innovation in products and services.

Once we have narrowed the field, our final criteria include the scope of global coverage, staff size, customer service, risk management, range of products and services, execution skills and intelligent use of technology. In the case of a tie, our bias leans toward a local provider rather than a global institution. We also tend to favor privately owned banks over government-owned institutions. The winners are those banks best serving the specialized needs of corporations as they engage in global business. The winners are not always the biggest but the best: those with qualities companies should look for when choosing a provider.

Banks across Western Europe enjoyed higher levels of business activity during 2022, feeding through to enhanced profitability that allowed them to reward shareholders while at the same time maintaining strong capital buffers. In response to the post-Covid surge in demand for credit, most European banks expanded new lending to business and personal customers—especially mortgages—and as interest rates increased, so did bank lending margins. This tended to favor banks focused mainly on lending and deposit taking over those with larger market-trading and fee-generating wealth management arms, where declining asset values and outflows of customer funds dampened performance.

The digital transformation of Europe’s banks continued accelerating, with former laggards now in catch-up mode through either direct investment in the latest technologies or closer collaboration with fintechs. Digital leaders invested more in cutting-edge technologies such as artificial intelligence and quantum computing, and more banks moved their internal functions from legacy on-site systems to the cloud. The consolidation of the European system was limited to divestments of non-core activities, such as the sale by Belgian and Scandinavian banks of their operations in Ireland to two leading local banks—until, that is, the “shotgun wedding” of UBS and Credit Suisse, which may lead to the creation of Western Europe’s largest bank by assets.

CaixaBank is our Best Bank in Western Europe and our country winner in Spain, dramatically increasing its market share and boosting profits by 30% during 2022 while continuing to extend its leadership in sustainable financing and digital innovation.

Chairman José Ignacio Goirigolzarri told shareholders in March that “the bank has considerable strengths, a well-defined strategy and a differential banking model,” and, referring to the recent turmoil in global banking, pointed out that with its widespread deposit base, CaixaBank has a very different business model. “Our investments are extremely diversified because we serve all markets, from large corporations to households,” he said. “Our ratios are extremely robust in terms of liquidity and solvency.”

The acquisition of former rival Bankia, he added, has been “the largest integration ever undertaken in Spain’s banking sector” and reinforced CaixaBank’s leadership across most market segments. Further investment in innovative remote or digital channels and ongoing refinements to its state-of-the-art banking app raised the number of its digital clients to 11.2 million. And last year, the bank’s first climate report unveiled its strategy to reduce emission levels from its loan portfolio to one of the lowest in global banking by 2030.

Net interest and fee income rose by 14.7% and 8.7%, respectively; and despite higher provisions, attributable profit surged to nearly €3.2 billion (about $3.5 billion). The nonperforming loan (NPL) ratio fell to a record low of 2.7%. Enhanced efficiencies helped reduce costs by 5.6%. As a result, the return on tangible equity (ROTE) rose to 9.8% and the bank reinforced its liquidity and capital base. It ended the year with a common equity Tier-1 (CET1) ratio of 12.8% and its liquidity coverage ratio of 194%, almost twice the 100% minimum required.

Portugal’s best capitalized and most consistently profitable bank, Santander Totta, is once more our country winner, having raised underlying profit while simultaneously deleveraging through active portfolio sales. Total loans and advances to customers, amounting to €43.3 billion, were flat year-on-year. The bank grew its mortgage book by 5.5%, strengthening its 23.7% market share of new home loans. Operating income was flat; but an 11% cost reduction fed into underlying profits of €534 million, a 16% improvement on the previous year.

CEO Pedro Castro e Almeida declared, in commenting on the annual results, “Santander will maintain its policy of supporting people and businesses to prosper, supported by the comprehensive digital and commercial transformation that we have been carrying out, with clear benefits in the quality of service provided to our customers.”

Our Best Bank in Italy is Intesa Sanpaolo, which once more demonstrated its ability to generate solid profits through a diversified and resilient business model. Net income increased by almost a third to €5.5 billion—excluding the costs of Russia and Ukraine de-risking. During 2022, the group’s exposure to Russia was sharply reduced to below 0.3% of overall customer loans.

The bank’s gross income increased by 11.5% over the previous year. Operating margins improved by 7.4% as revenue rose and costs were contained to under 51% of income. As a result, Sanpaolo’s domestic Banca dei Territori division, which focuses on small and midsize enterprises (SMEs) and retail, raised net income by nearly half, to €471 million, thanks to higher margins and significantly lower operating costs and net provisions.

NPLs were reduced by 30% gross over the year, resulting in an NPL ratio of 2.3%. Intesa Sanpaolo maintains solid capital buffers well above regulatory requirements, its CET1 ratio standing at 13.8% by year end.

The position of our Best Bank in Switzerland, UBS, has been completely transformed. CEO Ralph Hamers presented a robust set of financial results for 2022, just under three months before stepping down in April. The takeover of former arch-rival Credit Suisse has further reinforced UBS’ dominant position in Swiss banking. However, it also brings unquantifiable financial liabilities and significant regulatory and organizational challenges that must be overcome before the two entities can be fully integrated.

Globally, UBS delivered a pretax profit of $9.6 billion in 2022, generating a return on Tier-1 equity of 17%. Within Switzerland, the bank extended $2.5 billion of new loans, while its wealth management arm attracted $9.1 billion of fee-generating assets.

The bank delivered good full-year results in a difficult macroeconomic and geopolitical environment, noted Hamers in his comments regarding the results. “Clients turned to us for stability and advice. … This resulted in $60 billion of net new fee-generating assets in 2022,” he said.

Since he stepped down, Hamers has been replaced as group CEO by veteran UBS leader Sergio P. Ermotti, who now faces the monumental task of integrating the parts of Credit Suisse that can be rescued and forging a new bank that will be, on current asset values, the largest in Europe.

This year’s Best Bank in France is BNP Paribas, on the strength of its being a digital leader among European banks while at the same time generating a sparkling financial performance at both national and group levels. Commercial and personal banking in France generated a €1.6 billion profit before tax in 2022, representing a 35.6% increase over the previous year. Net interest income rose 5% and revenues 6.6%, while costs were contained.

“Thanks to its solidity, the strength of its diversified and integrated model, and the expertise of our teams, BNP Paribas achieved a very good performance,” CEO Jean-Laurent Bonnafé said in commenting on fourth-quarter results. “This performance reflects our unique positioning as a European leader, which is based on leading platforms to accompany our clients’ dynamism and ability to adapt and support the economy.”

“We are setting ambitious financial targets and pursuing our technological advances. We are strengthening our commitments to a sustainable economy and are entering a new phase of acceleration in financing the energy transition. We will continue with our clients the transformation effort that enabled us in 2022 to pivot our financing of energy production towards a majority of low-carbon energies.” The bank’s CET1 ratio stood at 12.3% at year end.

Commerzbank is this year’s Best Bank in Germany, as the success of its turnaround strategy combined with improved lending margins to generate the highest profit recorded in more than a decade. Revenue increased by 12% to €9.5 billion while operating costs came down by 3.2%, which fed through to a surge in net profit to €1.4 billion.

“Despite the difficult economic environment … we more than tripled our net profit,” CEO Manfred Knof said in a statement commenting on the bank’s 2022 performance. “That proves our strategy is working. Our turnaround is a success. Commerzbank is back.” He added, “At the halfway point of our transformation program, we are on track to becoming the digital advisory bank for Germany.”

Building on its strong relationships with the Mittelstand, or SMEs, Commerzbank is now expanding its new Mittelstandsbank Direkt digital-support model for SMEs.

“Without slackening on cost discipline,” Knof’s statement continued, “we are now focusing on the customer business and revenue. Especially in light of the current profound social and economic changes, our strengths in the advisory business are paying off.”

In Austria, our winner is Erste Bank, which in 2022 put in an impressive performance at both group and local levels. Stefan Dörfler, CFO of Erste Group, said in comments accompanying the 2022 financial results, that “supported by very solid loan growth across all of our markets and segments, and a favorable rate environment, net interest income was the key driver for the strong operating performance we achieved in 2022. In addition to benefiting from a positive revenue momentum, we also managed to contain our operating expenses, even in the face of last year’s significant inflationary pressures.”

Erste’s Austrian operations enjoyed near 10% growth in net interest income that, when combined with lower costs—assisted by increased onboarding to its George mobile banking app and other digital channels—raised operating profit by 14.5%, to €562 million. Net profit increased by 4.4%, and return on allocated capital improved to 14.6%. Erste’s Austria-based corporate business division was particularly profitable, boosting its net contribution to the group by more than 50% compared to the previous year.

Robert Swaak, CEO of ABN Amro, our winner in the Netherlands, commented in a statement accompanying the annual report, “The current environment confirms our strategic choices as we benefit from our improved risk profile. The financial results for 2022 were marked by the normalization of the interest rate environment and low impairments, while fee income increased by 7%. Our return on equity was 8.7%.”

Net interest income rose by 4%, fees and commissions by 7%, while costs were 7% lower than the previous year. These gains fed through to a 35% increase in operating profit and a 51% surge in the bank’s profitability after tax.

In 2022, Swaak continued, “all client units delivered better results. We executed our inaugural share buyback and maintained strict cost discipline. We transformed the business into three client units, published our climate strategy and were market leader in mortgages.”

“In the past year, the transformation influenced our [net promoter score] and employee engagement scores and we need to improve client and employee satisfaction. Culture remains my main priority … as we transition to becoming a personal bank in the digital age,” added Swaak.

This year’s Best Bank in Belgium is BNP Paribas Fortis, which achieved strong growth in both business activity and profitability during 2022 while continuing its role as a center of innovation, providing digital solutions for the whole BNP Paribas Group.

Lending volumes to individuals and commercial customers grew by 14.8%, mainly through increased mortgages, while corporate loans rose by 12.7%. Deposits rose by 9.2% with a substantial contribution from the recently acquired bpost bank. Net interest income rose by nearly 9%, boosting operating income and raising the pretax result to over €1 billion, 7.8% higher than the previous year.

Spuerkeess (BCCE), our Best Bank in Luxembourg, has the most domestic customers and is the market leader in most segments. Its most recent figures confirm its strong capital base and growing profitability, with net profit up by 24.1% on the back of modest loan growth and sharply improved lending margins.’

Among its many sustainability initiatives, Spuerkeess recently announced a collaboration with the Luxembourg Institute of Science and Technology, enabling the bank to carry out flood risk assessments, considering the impact of different climate change scenarios for its clients. “At Spuerkeess, we believe that our profitability is closely linked to sustainability,” proclaimed CEO Françoise Thoma when announcing the partnership.

Our winner for the third consecutive year in Liechtenstein is LGT, which is majority owned by the “Princely Family,” as the bank continued to grow profitability and attract new funds. Group profit increased 19% over the previous year to 420.8 million Swiss francs (about $471.5 million). Despite market uncertainties, LGT attracted net asset inflows of 17.1 billion francs, or 6% higher than the prior year, while total assets under management grew slightly to 287.2 billion francs.

“Despite the many challenges, LGT delivered exceptionally good results in 2022, enabling us to further invest in strengthening our business,” said LGT’s chairman, Prince Max von und zu Liechtenstein in a statement announcing the 2022 results. “We … expanded our international presence in key locations. In addition, we further invested in digitalization and expanding our investment solutions, and in sustainability at all levels.” LGT’s capital buffers are robust, with a tier 1 capital ratio of 19.1%.

CFM Indosuez Wealth Management is our Best Bank in Monaco. Unlike most other banks with only a limited presence, it operates internationally while being firmly anchored in the principality with its local minority shareholders and customers. CEO Mathieu Ferragut says that “based on its local roots and the support of its majority shareholder, the Credit Agricole Group, our firm is the leading banking institution in Monaco.”

Among CFM Indosuez’s achievements in 2022, Ferragut points to landmark transactions, including its green financing initiatives in Monaco and the success with clients of an innovative blue finance investment offer. “CFM Indosuez,” Ferragut adds, “is also actively pursuing its commitment to the environment and society.” In 2023, CFM Indosuez aims to be the leading bank in Monaco.

Our fifth-time winner in Andorra is the country’s largest and most consistently profitable bank, Credit Andorra. Its dominant position in the domestic market was reinforced last year by acquiring Vall Banc. Overall profitability has been rising by nearly 10% year-on-year; and its important private banking arm for Spanish clients, Creand Wealth Management, recorded a 38% increase in business volumes last year. The bank traditionally maintains robust capital and liquidity ratios.

The Bank of Valletta, the winner in Malta, has turned a page. For 2022, it reported a profit before tax of €48.7 million. But excluding the effect of legacy litigation, namely the costly Deiulemar settlement, adjusted profit before tax was €151.7 million—an increase of €71.0 million, or 88% compared to 2021. Again, excluding the one-time impact of this out-of-court settlement, its ROE rose to 13.3%.

Total operating income increased by 21% to €293.4 million, primarily driven by a 29% increase in net interest income. Net loans and advances amounted to €5.6 billion, up 8% compared to 2021. The bank maintained its capital buffers, its CET1 ratio reaching 21.8% at the year end.

Our winner in Cyprus is Hellenic Bank, leading the way in offloading problem loans and restructuring its balance sheet. “Despite the challenges caused by the war in Ukraine and the inflationary pressures, we managed to deliver a good set of financial results with a profit of €24.2 million for 2022, compared to losses of €11.7 million for 2021,” Group CEO Oliver Gatzke said, commenting on the bank’s release of its financial results. He noted that these results confirm the bank’s progress in implementing its transformation toward a client-centric and technology-driven organization.

New lending in 2022 reached a record €1.2 billion, up 30% year-over-year. Net interest income rose by 17%, fees by 10% and an operating profit of €138 million by 40%. Capital buffers were strengthened with a year-end CET1 ratio of 19.1%.

Eurobank, our winner in Greece, has led the way in shedding problem loans, restructuring its balance sheet and restoring profitability. During 2022, its nonperforming exposure (NPE) ratio improved further to 5.2% and it added nearly 300 basis points to its capital base, resulting in a CET1 ratio of 16% at the year end. Net interest and fee income increased by 17.4% and 19.1%, respectively. Core income rose by nearly a third, feeding through to a net profit of €1.3 billion, more than three times what was achieved in 2021.

“Credit expansion came strong in 2022, increasing loan balances by €3.3 billion, mainly to businesses,” CEO Fokion Karavias noted when introducing the bank’s annual results. “As such, we contributed to the efforts for the Greek economy to achieve a growth rate significantly higher than the EU average.”

Bank of Ireland is our winner for the Emerald Isle for the second year running. Last year, it dramatically expanded its customer base by acquiring Belgian bank KBC’s Irish business and leading Dublin-based broker Davy.

“We had an excellent performance in 2022,” the bank’s new CEO, Myles O’Grady, commented in his presentation. “That includes ROTE [10.6%], income [up 11%], costs and NPEs [down 40%]. Our underlying profit before tax was €1.2 billion. We also made two transformational acquisitions and welcomed 440,000 new customers to the group, an 11% increase. That contributed to strong growth in customer balances. And on top of that, we returned to full private ownership.”

Net interest income rose by 12%, and its resilience was strengthened through an increased structural hedge. Mortgage lending in Ireland grew by 64% while business income increased by 27%, with a substantial contribution from Davy. “We bank almost two in three companies establishing in Ireland,” O’Grady pointed out, “and we had net lending growth in business banking for the first time in more than a decade.”

Our Best Bank in the United Kingdom, Lloyds Bank, is among its peers the most digitally proficient and solidly focused on domestic customers. Improving interest margins provided the main motor for further income growth in 2022. Net interest income increased by 18%, while improved cost controls generated a 5% reduction in operating costs, resulting in a sharp fall in the bank’s cost/income ratio to 50.4%. This fed through to a net profit of £5.5 billion (about $6.8 billion) and a 13.5% return on equity.

“While the operating environment has changed significantly over the last year, the group has delivered a robust financial performance with strong income growth, continued franchise strength and strong capital generation, enabling increased capital returns for shareholders,” CEO Charlie Nunn commented. As a result, the bank’s CET1 ratio declined slightly to 14.1% at the year’s end.

Islandsbanki is this year’s Best Bank in Iceland thanks to its strong performance. CEO Birna Einarsdóttir noted in her introduction to the 2022 results, “Total operating income rose by more than 14% in 2022 with net interest income up by almost 27% year-on-year. The cost-to-income ratio was 42.1%, below our target of 45%.”

Pretax profits rose by 19%, generating an 11.8% ROE. “Loan growth was distributed equally between retail and corporate customers and was 9.2% for the full year,” Einarsdóttir noted. “Deposits from customers also grew substantially, by 6.2%,” reinforcing the bank’s primary funding source.

She highlighted the broad base of these advances, “with good results across all business units, all of which are generating good return on equity,” adding that “we are the market leader among small and medium-size companies and enjoy the highest market share among the 300 largest companies in the country. This success is extremely important to us as SMEs are the backbone of the Icelandic economy.”

This year’s winner in Norway is DNB, following strong performances across the board.

The bank’s report highlights the DNB’s 12.3% increase in loans to customers in 2022, while customer deposits grew by 10.7% over the same period, adding that “a high level of customer activity, increased interest rate levels and volume growth contributed to an increase in net interest income of 3.8 billion Norwegian kroner (about $357.5 million), or 36.8%.”

A surge in both fee and net interest income combined with a reduction in the bank’s cost/income ratio to 40.1% boosted overall profitability at the operating level. This fed through to a record net profit of 32.9 billion kroner. CEO Kjerstin Braathen commented, “After a year of high activity and good results in all areas of the bank, DNB is in a very sound financial position.” The bank’s CET1 ratio stood at 18.3% at the year’s end.

Swedbank is our winner in Sweden, having consolidated its market-leading position in most business segments and further increased its profitability. A 23% increase in net interest income was the main driver of higher total income, which was up 12% over the previous year. Moreover, despite a slight cost rise, the bank’s operating result was 19% higher at 27 billion Swedish kronor (about $2.6 billion).

“Swedbank is a profitable bank,” CEO Jens Henriksson underlined in a statement, whose “profit for 2022 increased to 21.9 billion kronor, corresponding to a return on equity of 13.3%.” He added that “credit impairments increased slightly due to the weaker macroeconomic outlook, but credit quality is good and our liquidity position is strong.” The bank’s strong capital buffers were maintained, and its Tier 1 capital adequacy ratio ended the year at 17.8%.

Our Best Bank in Finland is Nordea. The country is home to the bank’s headquarters and, during 2022, the best-performing country in this pan-Scandinavian banking group. In personal banking, total income increased by 42% year-on-year. Net interest income surged by 98%, driven by mortgage and deposit volume growth and improved deposit margins. Lower mortgage margins partly offset these. Both lending volumes and deposits increased by 2%, and volumes increased by 2%.

Nordea’s business banking in Finland also did well, with net interest income up by 35%, driven by higher lending and a 7% increase in deposits with improved margins. A digital pioneer, Nordea continues to develop and refine its multichannel offering to customers.

Nykredit is our Best Bank in Denmark once again, having achieved what CEO Michael Rasmussen called “its best-ever financial results.” The largest domestic lender in Denmark raised loan volumes by 16% and boosted its pretax profit by 7.3% to 11.5 billion Danish kroner (about $1.7 billion) on the back of high business and customer growth together with strict cost controls that resulted in a cost/income ratio of just 37.6%.

“Our full-year results were also driven by a strong credit quality, which has resulted in low loan impairments,” Rasmussen noted. “We successfully managed our own portfolios and also benefited from market tailwinds around year end.”

In a comment in the annual report, he also stressed the need to further push the bank’s green financing initiatives. “As a society, we share a common task: to make Denmark greener, Nykredit is owned by its customers,” he pointed out, “and it is only natural for us to help solve this common task.”

For decades, India has been an active investor in Africa. Its $74 billion of stock accumulated between 1996 and 2021 make it one of Afria’s leading inbound investors, and that engagement is growing as China pulls back. India’s bilateral trade with Africa grew from $56 billion in 2021 to $89.5 billion in 2022, according to government statistics, compared with $56 billion the previous year.

The United Arab Emirates (UAE) is, by comparison, a latecomer; yet it enjoys considerable financial muscle. Its initial investments in Africa focused on agriculture and were driven by food security concerns. Now it is looking to expand the scope of its engagement, and is doing so in partnership with India.

This makes perfect sense. Indian multinationals investing in Africa have focused on areas like agribusiness, pharma, information and communications technology, and energy. India has the trained workforce to engage and has a record of comparative transparency in its dealing with Africa. For its part, the UAE is a regional financial hub and has expertise in energy, transport and logistics.

The two countries’ skills are complementary. Their relationship has strengthened recently with the Comprehensive Economic Partnership Agreement between India and the UAE, which entered into force last May. India is currently the UAE’s second-largest trading partner, while the UAE is India’s third-largest trading partner.

A notable example of close cooperation is last August’s joint India-UAE health care delegation visit to Tanzania. The government-led task force focused on health care, particularly the establishment of new diagnostic centers, and explored the potential for joint initiatives with Tanzanian government officials and local health care providers.

The mission was accompanied by a phalanx of private sector companies seeking to explore investment opportunities in Africa. These included Apollo Hospitals, Fortis Healthcare, Medanta and NephroPlus from India; while among the UAE-based companies were G42 Healthcare and Tamouh Healthcare.

In the aftermath of the Covid-19 pandemic, there is also growing international pressure to relocate some vaccine production to Africa. Stephen Karingi, director of the UN Economic Commission for Africa’s Regional Integration and Trade division, notes that India and South Africa are leading moves to waive certain intellectual property rights so as to allow increased production of vaccines in Africa.

For this to go ahead, he says, India’s know-how in generics manufacturing is “crucial,” adding that “India signaled health care delivery will be key in its inclusive and transparent development model with Africa.”

Another example of closer cooperation between India and the UAE in investment in Africa is a multibillion-dollar plan to transform Tanzania’s capital, Dar es Salaam, into a leading transportation and logistics hub. The key players are the Abu Dhabi–based logistics, industry and trade facilitator AD Ports Group; and India’s largest integrated transport utility, Adani Ports and Special Economic Zone, the two of which signed a memorandum of understanding (MoU) in August to explore joint investment opportunities in Africa.

Mohamed Juma Al Shamisi, group CEO of AD Ports, says in a statement that “this MoU is significant in its impact on Tanzania’s ability to transform itself into an African trading hub, as well as our ability to further develop our global capabilities and connections that will bring goods to markets faster and more efficiently.”

However, this joint investment in Tanzania’s ports almost came apart at the end of January, when a report from US short-seller Hindenburg Research triggered a huge sell-off in Adani companies’ shares just before the Indian billionaire Gautam Adani’s flagship group was due to close a $2.4 billion public fundraising.

Abu Dhabi’s International Holding Company (IHC) responded by pledging to invest $400 million for 16% of the shares being offered by Adani Enterprises. This comes on top of an earlier investment of 7.3 billion Emirati dirhams (about $2 billion) that IHC had made in Adani last April.

But last-ditch efforts by IHC, alongside several Indian billionaires, to rescue the deal did not sway either international or domestic retail investors; and at the eleventh hour, Adani pulled the public fundraising to protect its investors.

Although the group’s listed companies (including Adani Ports) had by then lost over $100 billion in market value, the billionaire insisted this would “not have any impact on existing operations and future plans.”

Dar es Salaam’s prospects of becoming an African trading hub now depend largely on Adani’s damage-limitation skills and his ability to fulfill that pledge.

Bernard Arnault, who recently overtook Elon Musk as the world’s wealthiest individual, has elevated his eldest child, Delphine, to head up Christian Dior—the second-largest brand of French luxury-goods powerhouse LVMH.

Starting Feb. 1, Delphine replaces Pietro Beccari, who tripled Dior’s global sales during his five years at the helm. He will now lead the flagship Louis Vuitton brand.

Delphine Arnault, 47, takes an important step up in the line of succession at LVMH, where Bernard Arnault, 73, is still CEO. Her siblings hold significant roles within the sprawling business empire. Her brother, Antoine, oversees the overall holding company, while Bernard’s three sons from a second marriage are senior executives at Tiffany, Tag Heuer and Vuitton’s watches division.

As head of Christian Dior, Delphine now has the highest-profile role among the siblings. But for her it is also a return to her roots since she started at Dior, beginning with shoes and progressing over a period of 12 years to deputy managing director—where she minimized the negative fallout of John Galliano’s sudden departure in 2011 following his notorious racist and anti-Semitic outburst.  

Before joining LVMH in 2001, Delphine graduated from the Edhec Business School and the London School of Economics before joining consultancy firm McKinsey. Friends and colleagues praise her instinctive sense of fashion and ability to attract top talent. Married to telecom billionaire Xavier Niel, she has preferred to maintain a low profile.

While it is easy to see her ascension as a family affair, Delphine has natural verve and certainly knows the ropes at LVMH. Should a succession battle break out—as occasionally happens within Rupert Murdoch’s media empire—she is well placed to emerge the winner.

Bernard Arnault is expected to remain in charge until the age of 80.

Private banks are often characterized as “the jewel in the crown” of the broader financial institutions that own them. They are not particularly capital intensive, and they generate fee income. Their cost base is high, and they need to invest heavily in bespoke technology and human resources to be competitive. Thus far, they have been able to afford to do so. 

For most of the world’s private banks, 2021 was a memorable year. Buoyant markets contributed to sharp increases in assets under management (AUM) across all regions, while many private banks also experienced strong net inflows—a trend that continued into the first half of 2022 and is a strong forward indicator.

Profitability improved as the digital transformation brought new efficiencies and freed up private bankers to spend more of their time on client-facing activities that generate revenues. As a result, many private banks reported record profits.  

But if “a rising tide lifts all ships,” especially in terms of boosting AUM, the reverse is also true. Since the beginning of this year, the combination of higher volatility and a sharp downturn in markets affecting practically all asset classes means that most private banks are expected to report that AUM are down. On the flip side, higher base rates have boosted net interest margins on private banks’ lending to clients. But across the board, private banks’ profits are set to decline from extremely high levels.

Growing uncertainty has also shaped clients’ needs and expectations. Even before markets started retreating, “the pandemic had far-reaching effects on wealth clients’ financial perspectives,” according to Roopalee Dave, Wealth and Asset Management partner at EY. “Our latest Global Wealth survey showed that there is more focus than before on protecting wealth and ensuring financial security, and it evidences a market that is more risk averse than it was pre-pandemic.”

Singapore-based David Wilson, who leads Accenture’s wealth management team for growth markets, recognizes that a shift in asset class preferences is underway, though he is confident that “the Big Four (cash, fixed income, equities and real estate) will remain the Big Four. The key question is what clients’ order of preference in future will be.”

Sustainability is also emerging as a major issue. EY’s recent survey confirms clients want guidance from their private bank to meet sustainability objectives. Among millenials, 91% indicate that they personally have sustainability goals. As a rule, the younger a person is, the higher the expectation that their wealth manager screens investments based on environmental, social, and governance factors.

There are also signs that the traditional resilience of private bank client relationships with one main provider may be fraying—at least in Asia’s fast-growing markets. “The trend during the pandemic was for clients to be pretty sticky,” says Wilson. “Our research showed that only 10% of Asian clients in 2021 left their primary wealth management firm. This is largely due to two reasons: From an investment performance standpoint they were getting a good return, so they didn’t want to leave and rock the boat.  Secondly, they stayed because when you are locked down due to Covid-19, it’s hard administratively to leave your bank.”  But that stickiness was masking some very real issues, he adds, noting that 91% of clients were satisfied with their bank’s investment performance, but less than half expressed satisfaction with their firm overall.

EY’s global wealth management survey found an increase in consolidation of existing financial arrangements bringing back some stickiness. “Our survey showed just 28% of respondents expect to move wealth relationships over the next three years,” says Dave, “down from 32% in 2019 and 40% in 2016.” Respondents were found to be focused on value, willing to pay for more tailored service.

A similar shift in clients’ needs and priorities is revealed in the latest Accenture report, which is focused on Asia. It notes that investors are more interested in receiving advisory services than in following a self-directed approach where they make investment decisions themselves and use wealth firms simply to execute their trades.

“More advanced and accessible advisory services are key to unlocking wealth management growth opportunities in Asia,” says Wilson. “Investors in the region can no longer be categorized primarily as self-directed; they want advice and to validate their decisions with their wealth manager.”

How that advice and validation is best conveyed is a key question for today’s private banks. “The global market for wealth advice continues to transform,” observes Dave, “but the twin objectives of delivering the right advice while carefully managing costs remain front and center.”

Many private bankers believe technology is the key to delivery and cost issues. “The Covid-19 driven transformation of the client/wealth manager relationship towards multichannel is continuing apace, if not accelerating,” says Pascal Martino, the Luxembourg-based Banking and Human Capital leader at Deloitte. “Covid-19 has shown that technology and digital is a must-have, but is not sufficient on its own. It must be complemented with the human touch and capabilities.”

The key area private banks need to focus on now, he says, “is continuing to improve the customer experience through enhanced digital communications—from onboarding through to reporting and delivery of real-time information.”

EY’s Dave notes that “the hybrid advice model—combining personalized advice with digital innovation—continues to evolve as firms identify new ways of improving the client experience. Investment continues to be made in integrating technology and enhancing talent programs to ensure a streamlined end-to-end process.”

For most private banks, getting this right is a matter of survival. “Delivering a true advisory proposition that is goals-led, holistic, and digital-first but integrated with financial advisers will be crucial for future competitiveness,” says Wilson.

But the human element remains crucial. “A major focus for private banks recently has been on hiring relationship managers, because they tend to bring their existing book of business; and their strong track records, connections and relationships are prized,” says Wilson. However, he adds, “there are simply not enough of them, and they cost a lot of money.”

As a result, there is often a disconnect between a bank’s ambitious growth plans and the tools needed. “In private banking, digital is not a silver bullet,” says Wilson. “Firms need to unshackle their relationship managers. Digital can be used to strip those non-revenue generating activities and create more time for existing employees to be more productive, hunt for clients and cross-sell. It’s not easy to build trust via digital alone.”

Yet to equip today’s private banker to build a personal relationship with the client through multiple channels often requires further training and updating. Martino argues that to achieve this, private banks “must continue improving the employee experience—through internal tools, CRM[coustomer relationship management], management of the entire client life cycle and removal of administrative tasks by automation, as well as more digitally enabled client self-servicing.”

“In general, private banks are maintaining the necessary level of investment,” says Martino. “This is key to their survival and future success.” But for individual banks, the crucial task is to identify investments that result in positive business outcomes. The cost savings and revenues generated should then permit further investment into both employee and customer experiences, thereby enhancing the private bank’s offering overall.

Western Europe’s private banks enjoyed exceptional business levels and profits in 2021. Assets under management (AUM) grew by 12%, according to McKinsey’s annual private banking survey, largely due to favorable market conditions. Net inflows of client money doubled to 4%, while lending volumes grew by 7%. Profit margins were up and, while there were some notable exceptions, European private banks generated near-record profits and justified their reputation as the crown jewel of the sector.

Yet costs continue to rise, as private banks step up investments in technology and training to revive personalized relationships in the increasingly digitalized world. Further, government largesse has given way to inflation and rate hikes. The recent sharp market downturn already reduced AUM for most wealth managers. Private bankers must assist increasingly risk-shy investors and attract new money amid high market volatility.

Following a stellar performance in 2021, last year’s winner, BNP Paribas Private Banking, outpaced most of its European rivals in the first half of 2022 by attracting nearly €2.8 billion ($2.9 billion) of net asset inflows in its core markets of France and Belgium alone, mainly though new-client acquisition and by extending already strong relationships with entrepreneurs. BNP Paribas is effectively the region’s largest private bank and the clear leader in its core French and Belgian markets. It is extending its presence in the Netherlands and its offerings to ultrahigh net worth clients in Germany, while also establishing a strong franchise in Asia-Pacific and the Middle East.

The strong commitment to digital at parent BNP Paribas has brought a wave of apps specifically for private banking customers. One key innovation is the PaxFamilia app, developed by BNP Paribas Fortis in partnership with fintech Guiscare and now the basis of wealth management across all jurisdictions. “A fully remote bank would offer all kinds of banking services purely through digital means,” explains Stéphane Vermeire, head of private banking and wealth management. “Our ‘digital-conversational bank,’ however, goes well beyond this sole objective of digitizing banking services and enables clients to interact with their relationship manager—or the bank as a whole—to get personalized advice.”

While many European royals highlight environmental issues, but only Liechtenstein’s princely family has served these causes by embedding sustainable objectives into a bank’s investment strategies. As LGT Private Bank’s majority owners, they have been fostering sustainability in the financial sector for nearly two decades. The bank’s chairman, Prince Max von und zu Liechtenstein, is forceful in arguing that doing good and generating attractive investment returns do not have to be mutually exclusive. LGT tracks the ESG performance of nearly 10,000 companies and translates this data into a sustainability rating for the corresponding equity or bond, delivering transparent and easily comparable information to help clients align their portfolios with their values. During the past year, it launched its second dedicated impact fund, in conjunction with ESG specialist investor Lightrock, an LGT offshoot, to invest in companies who seek market-oriented returns and whose activities have a measurable positive impact on greenhouse gas emissions and climate change.

BBVA continues to invest in innovation as a driver of growth. While a significant share of investment goes into making back offices and platforms more robust and secure, it is also upgrading its customer relationship management and big data capabilities to enhance monitoring of investments, alerts and global client management, using client-ranking algorithms based on clients’ individual preferences and priorities.

The bank’s client reporting platform now provides a customizable experience in digital channels designed specifically for each customer’s portfolio, while its digital wealth planning is delivered through personalized and actionable journeys. A third of all BBVA private banking clients have embraced these digitized relationships, though they are designed to complement rather than replace the human links between each client and that client’s relationship manager.