The big bank bloodbath: losses near half a trillion dollars

By David Reilly

Getty Images

Big banks are nearly half a trillion dollars in the hole.

Since the start of 2016, 20 of the world’s bigger banks have lost a quarter of their combined market value. Added up, it equals about $465 billion, according to FactSet data.

Brexit isn’t all to blame. True, bank stocks have plummeted since the U.K. voted last month to leave the European Union. But they have been losing value since the start of the year, when a group of factors—the Chinese economy, the path of U.S. interest rates, oil prices—weighed on the markets.

More than pride is at stake. Sharp share-price falls will make it much more difficult, and expensive, for banks to raise capital if that is what is ultimately needed to shore up their balance sheets.

Just as bad, a serious decline in market value can breed inaction among bank executives. Instead of selling equity when they can, executives may wait for share prices to recover, only to find themselves in a worse situation as stocks drop even further.

Another potential worry: As bank share prices decline, employees get antsy. Compensation packages that include stock options or restricted stock suddenly become a lot less attractive.

To get a handle on the severity of 2016 for banks, The Wall Street Journal examined the biggest U.S., U.K. and Swiss banks, some of the biggest European ones, as well as the biggest bank in each of China and Japan.

The group included: J.P. Morgan Chase & Co. /zigman2/quotes/205971034/composite JPM +0.71% , Wells Fargo & Co. /zigman2/quotes/203790192/composite WFC +0.03%  , Bank of America Corp. /zigman2/quotes/200894270/composite BAC -0.09%  , Citigroup Inc. /zigman2/quotes/207741460/composite C -0.15%  , Goldman Sachs Group /zigman2/quotes/209237603/composite GS +1.77%  , Morgan Stanley /zigman2/quotes/209104354/composite MS +1.48%  , Royal Bank of Scotland PLC  , HSBC Holdings /zigman2/quotes/208272822/composite HSBC +0.76%  , Barclays PLC /zigman2/quotes/208409333/delayed UK:BARC -2.29%  , Standard Chartered PLC /zigman2/quotes/200125072/delayed UK:STAN -3.00%  , UBS Group AG /zigman2/quotes/206172872/composite UBS +4.73%  , Credit Suisse Group AG /zigman2/quotes/202835784/composite CS -52.00%  , BNP Paribas SA /zigman2/quotes/206351084/delayed FR:BNP +1.70%  , Credit Agricole SA /zigman2/quotes/209264506/delayed FR:ACA +0.66%  , Société Générale SA /zigman2/quotes/206663756/delayed FR:GLE -0.83%  , UniCredit SpA /zigman2/quotes/200769686/delayed IT:UCG +2.44%  , Deutsche Bank AG /zigman2/quotes/201442689/delayed XE:DTE +1.86%  , Banco Santander SA /zigman2/quotes/205677933/delayed ES:SAN +2.77%  , Industrial and Commercial Bank of China Ltd. and Mitsubishi UFJ Financial Group Inc. /zigman2/quotes/207520099/delayed JP:8306 -1.84%

Read the full version of this article at WSJ.com.

/zigman2/quotes/205971034/composite

Add to watchlist JPM

JPMorgan Chase & Co.

US : U.S.: NYSE

$ 126.70

+0.89 +0.71%

Volume: 14.91M

March 20, 2023 2:21p

P/E Ratio

10.46

Dividend Yield

3.16%

Market Cap

$370.30 billion

Rev. per Employee

$536,362

/zigman2/quotes/203790192/composite

Add to watchlist WFC

Wells Fargo & Co.

US : U.S.: NYSE

$ 37.77

+0.01 +0.03%

Volume: 24.64M

March 20, 2023 2:21p

P/E Ratio

11.98

Dividend Yield

3.19%

Market Cap

$143.26 billion

Rev. per Employee

$403,483

/zigman2/quotes/200894270/composite

Add to watchlist BAC

Bank of America Corp.

US : U.S.: NYSE

$ 27.80

-0.02 -0.09%

Volume: 57.59M

March 20, 2023 2:21p

P/E Ratio

8.71

Dividend Yield

3.17%

Market Cap

$222.67 billion

Rev. per Employee

$532,470

/zigman2/quotes/207741460/composite

Add to watchlist C

Citigroup Inc.

US : U.S.: NYSE

$ 44.19

-0.06 -0.15%

Volume: 19.29M

March 20, 2023 2:21p

P/E Ratio

6.32

Dividend Yield

4.62%

Market Cap

$86.01 billion

Rev. per Employee

$423,304

/zigman2/quotes/209237603/composite

Add to watchlist GS

Goldman Sachs Group Inc.

US : U.S.: NYSE

$ 308.91

+5.37 +1.77%

Volume: 2.56M

March 20, 2023 2:21p

P/E Ratio

10.25

Dividend Yield

3.25%

Market Cap

$101.81 billion

Rev. per Employee

$1.39M

/zigman2/quotes/209104354/composite

Add to watchlist MS

Morgan Stanley

US : U.S.: NYSE

$ 85.43

+1.25 +1.48%

Volume: 5.31M

March 20, 2023 2:21p

P/E Ratio

13.91

Dividend Yield

3.63%

Market Cap

$142.27 billion

Rev. per Employee

$800,587

/zigman2/quotes/208272822/composite

Add to watchlist HSBC

HSBC Holdings PLC ADR

US : U.S.: NYSE

$ 33.33

+0.25 +0.76%

Volume: 2.58M

March 20, 2023 2:21p

P/E Ratio

9.00

Dividend Yield

4.77%

Market Cap

$131.43 billion

Rev. per Employee

$427,228

/zigman2/quotes/208409333/delayed

Add to watchlist UK:BARC

Barclays PLC

UK : U.K.: London

136.36 p

-3.20 -2.29%

Volume: 129.63M

March 20, 2023 4:35p

P/E Ratio

N/A

Dividend Yield

5.32%

Market Cap

£22.11 billion

Rev. per Employee

£418,673

/zigman2/quotes/200125072/delayed

Add to watchlist UK:STAN

Standard Chartered PLC

UK : U.K.: London

615.00 p

-19.00 -3.00%

Volume: 10.16M

March 20, 2023 4:35p

P/E Ratio

9.38

Dividend Yield

2.41%

Market Cap

£18.08 billion

Rev. per Employee

£241,953

/zigman2/quotes/206172872/composite

Add to watchlist UBS

UBS Group AG

US : U.S.: NYSE

$ 19.06

+0.86 +4.73%

Volume: 34.61M

March 20, 2023 2:21p

P/E Ratio

8.47

Dividend Yield

2.90%

Market Cap

$60.20 billion

Rev. per Employee

$473,628

/zigman2/quotes/202835784/composite

Add to watchlist CS

Credit Suisse Group AG ADR

US : U.S.: NYSE

$ 0.96

-1.05 -52.00%

Volume: 340.70M

March 20, 2023 2:21p

P/E Ratio

N/A

Dividend Yield

4.11%

Market Cap

$7.89 billion

Rev. per Employee

$441,594

/zigman2/quotes/206351084/delayed

Add to watchlist FR:BNP

BNP Paribas S.A.

FR : France: Euronext Paris

€ 52.56

+0.88 +1.70%

Volume: 10.91M

March 20, 2023 5:38p

P/E Ratio

6.74

Dividend Yield

7.42%

Market Cap

€63.75 billion

Rev. per Employee

€454,815

/zigman2/quotes/209264506/delayed

Add to watchlist FR:ACA

Credit Agricole S.A.

FR : France: Euronext Paris

€ 10.06

+0.07 +0.66%

Volume: 17.78M

March 20, 2023 5:35p

P/E Ratio

5.98

Dividend Yield

10.44%

Market Cap

€28.57 billion

Rev. per Employee

€627,662

/zigman2/quotes/206663756/delayed

Add to watchlist FR:GLE

Societe Generale S.A.

FR : France: Euronext Paris

€ 21.03

-0.18 -0.83%

Volume: 11.10M

March 20, 2023 5:38p

P/E Ratio

9.84

Dividend Yield

8.09%

Market Cap

€15.57 billion

Rev. per Employee

€292,973

/zigman2/quotes/200769686/delayed

Add to watchlist IT:UCG

UniCredit S.p.A.

IT : Italy: Milan

€ 16.29

+0.39 +2.44%

Volume: 32.01M

March 20, 2023 5:35p

P/E Ratio

18.82

Dividend Yield

6.06%

Market Cap

€30.58 billion

Rev. per Employee

€109,436

/zigman2/quotes/201442689/delayed

Add to watchlist XE:DTE

Deutsche Telekom AG

XE : Germany: Xetra

€ 21.88

+0.40 +1.86%

Volume: 8.93M

March 20, 2023 6:30p

P/E Ratio

13.60

Dividend Yield

3.20%

Market Cap

€106.80 billion

Rev. per Employee

€552,319

/zigman2/quotes/205677933/delayed

Add to watchlist ES:SAN

Banco Santander S.A.

ES : Spain: Madrid

€ 3.23

+0.09 +2.77%

Volume: 118.63M

March 20, 2023 5:38p

P/E Ratio

6.21

Dividend Yield

2.96%

Market Cap

€52.62 billion

Rev. per Employee

€453,275

/zigman2/quotes/207520099/delayed

Add to watchlist JP:8306

Mitsubishi UFJ Financial Group Inc.

JP : Japan: Tokyo

¥ 825.40

-15.50 -1.84%

Volume: 129.86M

March 20, 2023 3:00p

P/E Ratio

25.64

Dividend Yield

3.88%

Market Cap

¥10182.24 billion

Rev. per Employee

¥58.65M