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Where in the world are banks profitable?

World Bank data on ROA for 173 economies


There are many indicators to help us evaluate the U.S. economy, but international data are a little more limited. Which is why FRED is fortunate to have World Bank data to compare economic conditions across countries. Today, we look at how well banks are doing—according to their return on assets—all over the world. Measuring banks’ ROA is relatively simple: Aggregate the net income of all commercial banks in a country and divide this sum by their total assets.

The graph above shows three countries with contrasting fortunes. The most dramatic is Greece, whose banks have been struggling with bad debt. Then there’s Kenya, whose banks are doing surprisingly well, at least under this dimension. Finally, the United States is in the middle, with a noticeable dip during the financial crisis and lower returns since that crisis.

FRED has regional data that you can map using GeoFRED. And that’s exactly what we have in the map below: The world’s most profitable banks (darker colors) tend to be in the Global South, with Moldova, Belarus, and Iceland also doing very well.

How these graphs were created: For the graph, search for “bank return on assets,” select the countries you want displayed, and click “Add to Graph.” For the map, scroll down to the related links for the series, click on one of the suggested GeoFRED maps, and zoom out to see the whole world. (Click on each country to see the name and its data value; use the “Edit Labels” tab to hide or reveal the countries’ names on the map.)

Suggested by Christian Zimmermann.

View on FRED, series used in this post: DDEI05GRA156NWDB, DDEI05KEA156NWDB, DDEI05USA156NWDB


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