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Brand value of Indian banks pegged at $14.7 bn

MUMBAI: The downturn in US and Japan has massaged the brand value of Indian banks as 18 of them make it to the Top 500 league.


The total brand value of Indian Banks has grown 19 per cent to $14.74 billion, according to the latest survey of brand valuation consulting company Brand Finance.


The survey, which was done in partnership with The Banker magazine, ranked the State Bank of India (SBI) two notches up in the pecking order as it has transformed into a customer-led organisation.


SBI, which became the first Indian bank to break into the world‘s Top 50 list in 2010, has moved to the 34th position in the new survey.


SBI has a brand value of $5.67 million, as compared to $4.55 million in the 2010 survey, as it continued to strengthen its position by accelerating transformation into a brand and customer-led business model with focus on innovation.


BrandFinance Global Banking 500 is an annual review of the top banking brands in the world. 
  
ICICI Bank has a brand value of $2.50 billion and has to more than double its speed if it has to catch up with SBI.


Axis Bank, which currently stands at No 202 (from 239), has seen an increase of 50 per cent in the brand value to $652 million and would possibly make it to the top 200 of global banking 500 by next year.
  
The methodology employed by Brand Finance uses a discounted cash flow (DCF) technique to discount estimated future royalties at an appropriate discount rate, to arrive at a net present value (NPV) of the trademark and associated intellectual property: the brand value.


Indian banks among top 500 list include-






















































































































BankCurrent RatingPrevious RatingBrand ValueMarket Cap
SBI3436567046,417
ICICI Bank6970250128,809
HDFC Bank15514191325,051
Punjab National Bank1951746759,298
Axis Bank20223965214,452
Bank of Baroda2131965857,648
Canara Bank2242135505711
Bank of India2421955026,602
Kotak2632874348,307
HDFC322N/A31523,573
IDBI Bank3243053092,562
Indian Overseas Bank3433342901,836
Power Finance Corporation375N/A2249,399
Union Bank of India3762742444,422
Centeral Bank of India3904712371,766
Allahabad Bank3933452352,838
Corporation Bank4493931932,319
Andhra Bank4504611901,786

The survey also claims that the banking sector is showing signs of recovery, with the world’s 500 most valuable banking groups growing by 62 per cent in market capitalisation and their brand values cumulatively increasing by 49 per cent.


Banker magazine said that there is a decline in US dominance of World banking industry and rise in banking brands from Middle East.


Also, this is the first time that a Russian bank has broke into the Worlds top 20 bank brands.


Explains Brand Finance plc CEO David Haigh, “This year’s Brand Finance Global Banking 500 shows how significant the recovery of global banking brands has been. The value of the Top 500 global bank brands is now four per cent higher than in 2008, prior to the banking crisis. The total value of the top 500 global bank brands has increased 49 is $716 billion, an increase of 49 per cent on 2009.There has been a significant shift in the balance of power globally away from the US and towards banks in emerging markets.”


Asian markets, despite doing well, grew by only 31 per cent in brand value because Japanese brand values declined by 3 per cent reflecting the continued instability of the Japanese market.


India and China, in contrast, saw brand value growth by 137 per cent and 58 per cent respectively.


Banks in the Pacific region, including Australia and New Zealand, have seen a recovery with a growth of 58 per cent.



Whilst the number of European banks in the Global 500 has increased from 174 to 197, the number of UK banks has fallen from 24 to 22. This suggests that recovery in continental Europe – most particularly in France, Spain and Switzerland – has left British banks behind. European bank brands have recovered significantly, growing their brand value in aggregate by 67 per cent.


The Banker editor Brian Caplen adds, "In the wake of the financial crisis, banks are approaching the issue of branding with renewed vigour. However this cannot be a short term project. What Brand Finance’s rankings show is that successful banks such as HSBC and Santander work at getting all the parts of the operation to work in favour of the branding."


The Top 10 banks in the list include:



  1. Bank of America (US)

  2. Wells Fargo (US)

  3. HSBC (UK) 

  4. Santander (Spain)

  5. Chase (US)

  6. Bradesco (Brazil)

  7. Barclays (UK)

  8. ICBC (China)

  9. Citi (US)

  10. China Construction Bank (China)

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