The market capitalization of the global banking sector was 7.2 trillion euros in the third quarter of 2019. Market cap is the number of shares in a company multiplied by the price per share. In this case, the sector market cap is the sum of this metric for all major banks.
Market cap and banking
The leading banks worldwide each have a market cap up to hundreds of billions of U.S. dollars. Naturally, the metric can mostly measure publicly traded companies as they are obliged to publish financial reports. The major international banks are already publicly traded, as opposed to smaller financial institutions or fintech companies operating in the banking sector.
Other measures
Market cap gives an idea of the value of a bank’s size, but says little about the size of its balance sheet. For this reason, sometimes analysts prefer alternate measures. Assets under management gives an idea of the total value of assets that a bank oversees. Depending on the type of bank, looking at sources of revenue may better explain the bank’s operational priorities.
Market cap and banking
The leading banks worldwide each have a market cap up to hundreds of billions of U.S. dollars. Naturally, the metric can mostly measure publicly traded companies as they are obliged to publish financial reports. The major international banks are already publicly traded, as opposed to smaller financial institutions or fintech companies operating in the banking sector.
Other measures
Market cap gives an idea of the value of a bank’s size, but says little about the size of its balance sheet. For this reason, sometimes analysts prefer alternate measures. Assets under management gives an idea of the total value of assets that a bank oversees. Depending on the type of bank, looking at sources of revenue may better explain the bank’s operational priorities.
