Royal Bank is not only Canada’s biggest bank by market cap, now it has overtaken TD to become the country’s most expensive banking brand.
RBC gained 20% in 2021 to reach a brand value of US$19 billion, which is a measure of the net economic value of licensing the brand on the open market. Valued at US$17.5 billion, TD is now ranked behind RBC for the first time since 2019.
The numbers come from London-based Brand Finance, which each year compiles a ranking of the top 500 most valuable and strongest banking brands in the world.
The pandemic has been hard on banking brands. At the beginning of 2020, the brand value of the world’s largest banks shrank by 2%, says the report. By 2021 it had dropped another 4% as economic uncertainty and lower interest rates undermined profits.
This past year banks turned the tide, with brand values rising 9% to a record high of US$1.38 trillion. Not only have loan losses been less significant than expected, improved digitalization, along with the economic recovery, also boosted the industry’s profitability in 2021 , it said.
Nonetheless, the advances over the past year still only put the total brand value of the top 500 global banks 2% above pre-pandemic levels.
RBC and TD started 2021 almost neck and neck at about $16 billion, with TD just $150 million ahead. But over the year RBC achieved double the growth.
This moved Royal Bank two spots higher on the global ranking to 11th place, its highest ever and on the doorstep of the top 10 global banks, dominated by China and the US
Canada’s place on the ranking is a testament not just to RBC but to the country’s banking industry as a whole. Nine Canadian banks made the top 500 with a combined value of US$73.1 billion, more than any other nation besides China and the US
The average value of a Canadian banking brand is US$8.1 billion, more than the average for China (US$6.1 billion) and the US (US$4.1 billion), said the report.
“Canadian banking brands are on average more valuable than their peers around the world,” said Charles Scarlett-Smith, client director of Brand Finance Canada.
On the global ranking, TD came in at No. 14, Scotiabank, 24, BMO, 32 and CIBC, 42.
Five US banks made the top 10, Bank of America, Citi, Chase, Wells Fargo and JPMorgan in that order. Wells Fargo, still plagued by the account scandal, was the only US bank to fall in the ranking.
Royal Bank isn’t just the top bank brand, it’s also the top brand in Canada overall, according to Brand Finance’s separate ranking of global brands that came out last month.
And the most valuable brand in the world? That would be Apple Inc, with a record valuation of US$355 billion.