Which FIs Did Best in 2013? Check Their Net Income per Employee
There are many ways to measure bank efficiency, but in 2013 net income per employee was arguably the best indicator of all for stock performance among large financial institutions.
Net income per employee — net income divided by total employees — indicates whether, on a deep level, a financial institution is operating in a profitable manner, particularly since in some corners of financial services, personnel costs are high.
When we looked at global financial institutions with market capitalizations of more than $5 billion, we found that the 20 with the most net income per employee outperformed the others in stock appreciation by 270 basis points. (All our data is year to date as of today.) Meanwhile, the big companies ranking from 21 to 50 in net income per employee underperformed the industry by 1,157 basis points.
Banking stocks, as an industry, grew 33.54% in value in 2013 YTD.
The performance between the two groups of large companies was stark. Those top 20 financial institutions averaged nearly $149,000 of net income per employee. The other FIs, meanwhile, managed just under $40,000 of net income per employee, or about 73% less.
50 LARGEST FINANCIAL INSTITUTIONS RANKED BY NET INCOME PER EMPLOYEE
| Rank | Company Name | Symbol | Market Capitalization | Price Performance (This Yr) | Revenue Per Employee | Net Income Per Employee |
|---|---|---|---|---|---|---|
| 1 | INTERCONTINENTALEXCHANGE GROUP | ICE | $25.9B | 81.52% | $1.29 | $519,546.89 |
| 2 | CME GROUP INC | CME | $26.5B | 60.76% | $1.13 | $365,576.92 |
| 3 | CIT GROUP INC | CIT | $10.3B | 33.13% | $1.05 | $211,404.49 |
| 4 | SLM CORP | SLM | $11.3B | 51.84% | $0.97 | $210,147.06 |
| 5 | FIRST REPUBLIC BANK | FRC | $6.8B | 60.83% | $0.75 | $200,813.27 |
| 6 | SUMITOMO MITSUI FINANCIAL | SMFG | $71.1B | 41.69% | — | $144,422.69 |
| 7 | GRUPO FINANCIERO SANTANDER | BSMX | $9.0B | -15.95% | $0.54 | $131,769.74 |
| 8 | NASDAQ OMX | NDAQ | $6.7B | 59.74% | $1.24 | $131,683.96 |
| 9 | MITSUBISHI UFJ FINANCIAL | MTU | $92.2B | 20.11% | $0.56 | $130,170.87 |
| 10 | MOODY’S CORP. | MCO | $16.7B | 53.90% | $0.43 | $111,455.88 |
| 11 | CAPITAL ONE | COF | $43.7B | 30.81% | $0.62 | $108,706.08 |
| 12 | FIFTH THIRD BANCORP | FITB | $18.5B | 37.63% | $0.33 | $86,739.11 |
| 13 | U.S. BANCORP | USB | $73.7B | 26.39% | $0.33 | $86,018.67 |
| 14 | MSCI INC | MSCI | $5.1B | 40.27% | $0.37 | $83,273.65 |
| 15 | M&T BANK CORP | MTB | $15.1B | 17.87% | $0.32 | $77,034.13 |
| 16 | SHINHAN FINANCIAL GROUP | SHG | $21.3B | 22.65% | $0.63 | $76,737.55 |
| 17 | WELLS FARGO & CO | WFC | $239.7B | 33.12% | $0.33 | $75,694.65 |
| 18 | LEUCADIA NATIONAL CORP | LUK | $10.3B | 21.76% | $0.96 | $74,070.18 |
| 19 | AMERICAN EXPRESS CO | AXP | $95.5B | 55.17% | $0.54 | $73,826.77 |
| 20 | BANCO DE CHILE | BCH | $13.5B | -8.38% | $0.29 | $72,513.00 |
| 21 | ITAU UNIBANCO | ITUB | $33.0B | -9.65% | $0.56 | $68,427.69 |
| 22 | JPMORGAN CHASE & CO | JPM | $218.6B | 32.23% | $0.41 | $67,758.19 |
| 23 | BERKSHIRE HATHAWAY INC | BRK/A | $153.1B | 32.15% | $0.62 | $65,994.83 |
| 24 | BANCO SANTANDER-CHILE | BSAC | $10.9B | -19.02% | $0.38 | $64,751.39 |
| 25 | PNC | PNC | $41.6B | 34.11% | $0.30 | $64,617.57 |
| 26 | ORIX CORP | IX | $23.2B | 58.26% | $0.58 | $63,452.50 |
| 27 | COMERICA INC | CMA | $8.7B | 56.46% | $0.29 | $61,782.09 |
| 28 | HSBC | HSBC | $205.3B | 3.18% | — | $59,266.67 |
| 29 | KB FINANCIAL GROUP | KB | $15.0B | 8.44% | $0.81 | $59,188.68 |
| 30 | HUNTINGTON BANCSHARES | HBAN | $8.0B | 50.39% | $0.25 | $52,203.96 |
| 31 | BANCO BRADESCO | BBDO | $28.4B | -4.32% | $0.71 | $52,202.78 |
| 32 | KEYCORP | KEY | $12.0B | 59.14% | $0.28 | $52,023.86 |
| 33 | ING GROEP NV | ING | $53.4B | 46.58% | $0.59 | $50,500.96 |
| 34 | MCGRAW HILL FINANCIAL INC | MHFI | $21.0B | 41.70% | $0.29 | $49,619.46 |
| 35 | REGIONS FINANCIAL | RF | $13.5B | 37.87% | $0.24 | $48,789.86 |
| 36 | CITIGROUP INC | C | $158.5B | 32.10% | $0.36 | $47,505.79 |
| 37 | SUNTRUST BANKS INC. | STI | $19.6B | 29.14% | $0.33 | $46,082.61 |
| 38 | BB&T CORP | BBT | $26.2B | 27.45% | $0.31 | $45,029.41 |
| 39 | CREDICORP LTD | BAP | $10.3B | -11.08% | $0.18 | $27,569.68 |
| 40 | BANK OF AMERICA CORP | BAC | $167.1B | 34.97% | $0.37 | $27,194.13 |
| 41 | ZIONS BANCORPORATION | ZION | $5.5B | 39.21% | $0.23 | $25,397.47 |
| 42 | ICICI BANK LTD | IBN | $21.4B | -14.90% | — | $20,975.22 |
| 43 | WOORI FINANCIAL HOLDINGS CO LTD | WF | $9.8B | 8.88% | $0.52 | $20,356.39 |
| 44 | NATIONAL BANK OF GREECE | NBG | $13.8B | -67.93% | — | $20,287.66 |
| 45 | BBVA | BBVA | $71.0B | 31.10% | — | $15,818.72 |
| 46 | BANCO SANTANDER | SAN | $101.5B | 10.16% | — | $10,437.86 |
| 47 | ING US | VOYA | $9.2B | — | $1.22 | $4,242.86 |
| 48 | BARCLAYS PLC | BCS | $72.6B | 12.98% | — | $3,894.57 |
| 49 | LLOYDS BANKING | LYG | $93.7B | 64.06% | $0.61 | ($2,238.49) |
| 50 | ROYAL BANK OF SCOTLAND | RBS | $63.4B | 3.99% | $0.30 | ($34,015.62) |
The message here is that good things come to large banks that keep their net income per revenue strong.
