In this article we are going to list the 16 largest financial services companies in the world. Click to skip ahead and jump to the 5 largest financial services companies in the world.
Before I go into details about the financial services industry, let’s first take a look at what being a financial services company means. A financial services company refers to a financial company which provides economic services. This can include a range of things such as banks, credit card companies, insurance companies, accountancy companies, credit unions, stock brokerages, investment funds and consumer finance companies among others. The finance sector is basically what makes the world go around; it is estimated that the financial services sector will be worth approximately $22.5 trillion dollars by 2022, which is a staggering number and is quite difficult to comprehend even.
The financial services sector has seen a lot of ups and downs over the decades with perhaps one of its biggest downs coming in the global recession 10 years ago, which saw many large and historically significant companies within the industry go bust and having to file for bankruptcy. A major rebuilding has taken place since, which has ensured that the current situation of the industry is much better than it was a little over a decade ago. Meanwhile, the industry has also adapted to the latest technologies available, which are the primary mediums used by the new generations and many companies have established a significant digital presence. If we talk about market capitalization, then just the banking sector currently worth around $7.9 trillion right now.
Without a sound financial system, no country can develop or grow economically, which basically means that a country cannot prosper without a stringent and extensive financial sector, and this isn’t just my belief, these are the beliefs of the World Bank as well. Further, tapping into capital markets is essential to attract further resources and additional financing, which itself may be quite extensive. When there is financial stability, jobs are plentiful and productivity is improved. Money flows to where it is most required in an efficient system, which is perhaps the most important thing. This in turn helps achieve a higher standard of living for the country as the people have what they require and basic necessities are fulfilled, further helping to level the playing field and ensuring that it allows betterment for everyone rather than just a few select individuals.
However, even though a lot of advancements have been made in the financial services industry, it has been quite hard hit with the Covid-19 pandemic, which has seen over 60 million cases and around 1.4 million deaths. As governments went into lockdown to prevent further spread, many industries suffered greatly while investors withdrew their money from stock markets as uncertainty prevailed. This led to some terrible market crashes in March 2020, when lockdowns were enforced and gold prices rose simultaneously since gold is considered to be a much safer investment. Even though multiple vaccines are in the works, the pandemic is not even close to its end and what the final impact will be, only time will tell. Most countries are in a recession; every advanced country is in either a recession or a depression, while every emerging economy is currently facing a recession. Current estimates suggest that economic recovery will only be achieved by 2025.
The biggest financial services companies are also some of the biggest companies in the world. In fact, according to Fortune 500 Global, there are 121 financial companies alone in the top 500 companies in the world by revenue. We have used the same list as a source, using revenue, profit, assets and employees as metrics, giving higher weightage to the latter two as they seem more prudent in indicating the size of a company. The combined assets of these companies are worth over $36 trillion (with some companies owning trillions of dollars of assets alone) while revenues exceed over $2 trillion and profits exceed $385 billion. These assets are more than what most countries own, as can be seen in the list of 16 wealthiest countries in the world ranked by financial assets. As you would expect, a lot of these companies are either from the US or China, though Chinese giants are mostly state-owned and hence, have little competition or dearth of money. Of the 16 companies in the list, 5 are from China, 6 are from the US, 4 are from Europe while one is from Japan. So let’s take a look at the giants running this world, starting with number 16:
Total revenue in 2019 (in millions of dollars): 148,984
Total profit in 2019 (in millions of dollars): 4,317
Total assets in 2019 (in millions of dollars): 876,457
Total employees in 2019: 99,483
Axa is a French insurance company and is headquartered in Paris, and is one of the oldest companies in our list, being 204 years old currently.