Global Capital Index Shows Improved U.S. Capital Positions

The FDIC released its semi-annual report of the Global Capital Index for the first half of 2017. The report shows an increase in capital ratios at most U.S. global systemically important banks ("U.S. GSIBs"). In addition, the average leverage ratio of U.S. GSIBs increased to 6.62 percent equity-to-assets as of June 30, 2017, as compared with 6.28 at the end of 2016. See also FDIC Statement, Thomas M. Hoenig (April 13, 2017) on the Semi-Annual Update of the Global Capital Index.

U.S. GSIBs also reported more favorable market value with an average price-to-book ratio of 1.28 percent over the last six months, as compared with a discount to book of .90 percent in 2016. European GSIBs reported a discount to book of .81 percent, while Asian GSIBs reported a discount to book of .72 percent.

FDIC Vice Chair Thomas Hoenig commented on the implications of the data:

"The data show that the stronger equity capital position of U.S. banks, as compared with their lower capitalized competitors around the world, is reflected in their higher price-to-book. U.S. banks have demonstrated that they can strengthen their leverage ratios and attain more sound levels of capital while remaining the most competitive and profitable in the world."