COVID19: World banks lose $635 bln in market cap; Wells Fargo, Santander biggest losers

Fourteen major banks in the world have lost a cumulative $635.3 bln in market capitalisation since last December, primarily due to the coronavirus pandemic, according to a survey by Buy Shares.

Wells Fargo recorded the biggest slump with a 56.26% drop in market cap, followed by Spain’s Banco Santander ( -46.16%), JP Morgan Chase ( -30.16%), and Japan-based Mizuho Financial Group ( -11.33%).

Intervention by central banks cushioned most facilities from a further slump.

According to the study, the drop in valuations for the selected banks could have been much worse if there was no intervention from central banks.

“The immediate measures taken by regulators to ease restrictions on liquidity and capital, banks have proved beneficial. Although the measures put in place by authorities helped banks, they still face some immediate pressures on their capital and liquidity position, as the length and severity of the outbreak remain uncertain.”

An overview of the individual market capitalisation shows that JP Morgan still holds a superior position at $437.2 bln in December 2019 and $305.44 bln as of August 2020. In December last year, Wells Fargo’s market cap stood at $227.5 bln and in August it was reduced to $99.5 bln.

At the end of last year, the Bank of America market cap stood at $316.8 bln and by the end of August, the figure stood at $223.01 bln.