The 32 Systemically Financial Institutions That Could Bring The System To Its Knees

The 32 Systemically Financial Institutions That Could Bring The System To Its Knees

via Clusterstock by Gregory White on 4/21/10

NYU Stern has released their rankings for banks capable of causing systemic risk. Banks and other financial firms bailed out by the government, or sponsored by the state, fill out the higher portions of the list. Stern has developed its proprietary SRISK%, which identifies the percentage of the overall systemic capital shortfall that would be borne by that firm. It calculates just how exposed each firm is to a financial crisis, and suggests how much the company would share its problems with the rest of the economy. The higher the number, the larger the shock to the system, the bigger the threat the firm to financial stability. MES, another data point, describes what percentage the company’s stock would decline in the event of a 2% market fall. ERISK attempts to explain the amount of capital the firm specifically would be short in a crisis. This effects both equity holders, and bond holders of the firm, potentially extending the crisis.

Here are the 32 banks and CEO’s that could cause serious systemic risk >

Ranked 32: MBIA, CEO Gary Dunton

Company Type: Insurance Systemic Risk Percentage: 0.13% Equity Risk: 2.99% Marginal Expected Shortfall: 3.18% Source: NYU Stern

Ranked 31: Huntingtons Bancshares, CEO Stephen D. Steinour

Company Type: Depositories Systemic Risk Percentage: 0.23% Equity Risk: 3.6 Marginal Expected Shortfall: 4.3 Source: NYU Stern

Ranked 30: Comerica, CEO Ralph Babb

Company Type: Insurance Systemic Risk Percentage: 0.29% Equity Risk: 3.18 Marginal Expected Shortfall: 3.57 Source: NYU Stern

Ranked 29: AMBAC Financial, CEO David W. Wallis

Company Type: Insurance Systemic Risk Percentage: 0.3% Equity Risk: 10.76 Marginal Expected Shortfall: 18.62 Source: NYU Stern

Ranked 28: Synovus Financial, CEO Richard E. Anthony

Company Type: Depositories Systemic Risk Percentage: 0.3% Equity Risk: 5.67 Marginal Expected Shortfall: 8.48 Source: NYU Stern

Ranked 27: Zions Bancorporation, CEO Harris H. Simmons

Company Type: Depositories Systemic Risk Percentage: 0.31% Equity Risk: 4.19 Marginal Expected Shortfall: 5.48 Source: NYU Stern

Ranked 26: Marshall & Ilsley, CEO Mark F. Furlong

Company Type: Depositories Systemic Risk Percentage: 0.32% Equity Risk: 4.22 Marginal Expected Shortfall: 5.55 Source: NYU Stern

Ranked 25: Ameriprise Financial, CEO James M. Cracchiolo

Company Type: Financial Products Systemic Risk Percentage: 0.36% Equity Risk: 3.33 Marginal Expected Shortfall: 3.35 Source: NYU Stern

Ranked 24: E-Trade, CEO Steven Freiberg

Company Type: Broker Dealer Systemic Risk Percentage: 0.4% Equity Risk: 4.46 Marginal Expected Shortfall: 3.94 Source: NYU Stern

Ranked 23: CIT Group, CEO John Thain

Company Type: Business Lender Systemic Risk Percentage: 0.41% Equity Risk: 2.02 Marginal Expected Shortfall: 0.64 Source: NYU Stern

Ranked 22: Keycorp, CEO Henry Meyer

Company Type: Depositories Systemic Risk Percentage: 0.52% Equity Risk: 3.74 Marginal Expected Shortfall: 4.56 Source: NYU Stern

Ranked 21: Principal Financial Group, CEO Larry Zimpleman

Company Type: Insurance Systemic Risk Percentage: 0.59% Equity Risk: 3.34 Marginal Expected Shortfall: 3.89 Source: NYU Stern

Ranked 20: Capital One Financial, CEO Richard Fairbank

Company Type: Loans and Credit Cards Systemic Risk Percentage: 0.6% Equity Risk: 3.92 Marginal Expected Shortfall: 4.56 Source: NYU Stern

Ranked 19: Suntrust Banks, CEO James M. Wells, III

Company Type: Depositories Systemic Risk Percentage: 0.75% Equity Risk: 3.79 Marginal Expected Shortfall: 4.7 Source: NYU Stern

Ranked 18: Fifth Third Bancorp, CEO Kevin T. Kabat

Company Type: Diversified Finance Systemic Risk Percentage: 0.76% Equity Risk: 4.21 Marginal Expected Shortfall: 5.08 Source: NYU Stern

Ranked 17: Genworth Financial, CEO Michael D. Fraizer

Company Type: Insurance Systemic Risk Percentage: 0.78% Equity Risk: 3.59 Marginal Expected Shortfall: 4.27 Source: NYU Stern

Ranked 16: PNC Financial Services, CEO Jim Rohr

Company Type: Depositories Systemic Risk Percentage: 0.82% Equity Risk: 3.14 Marginal Expected Shortfall: 3.4 Source: NYU Stern

Ranked 15: Regions Financial, CEO Grayson Hall

Company Type: Depositories Systemic Risk Percentage: 0.82% Equity Risk: 3.95 Marginal Expected Shortfall: 4.98 Source: NYU Stern

Ranked 14: Wells Fargo, CEO John Stumpf

Company Type: Depositories Systemic Risk Percentage: 0.91% Equity Risk: 3.2 Marginal Expected Shortfall: 3.56 Source: NYU Stern

Ranked 13: Lincoln National, CEO Dennis Glass

Company Type: Insurance Systemic Risk Percentage: 1.03% Equity Risk: 3.82 Marginal Expected Shortfall: 4.81 Source: NYU Stern

Ranked 12: MetLife, CEO C. Robert Henrikson

Company Type: Insurance Systemic Risk Percentage: 1.33% Equity Risk: 2.86 Marginal Expected Shortfall: 2.95 Source: NYU Stern

Ranked 11: Sallie Mae (SLM), CEO Albert Lord

Company Type: Student Lender Systemic Risk Percentage: 1.34% Equity Risk: 4.42 Marginal Expected Shortfall: 5.45 Source: NYU Stern

Ranked 10: Hartford Financial Services Group, CEO Liam E. McGee

Company Type: Insurance Systemic Risk Percentage: 1.97% Equity Risk: 3.13 Marginal Expected Shortfall: 3.38 Source: NYU Stern

Ranked 9: Prudential Financial, CEO John Strangfeld

Company Type: Insurance Systemic Risk Percentage: 2.61% Equity Risk: 3.26 Marginal Expected Shortfall: 3.68 Source: NYU Stern

Ranked 8: Morgan Stanley, CEO James Gorman

Company Type: Broker Dealer Systemic Risk Percentage: 5.25% Equity Risk: 5.3 Marginal Expected Shortfall: 5.68 Source: NYU Stern

Ranked 7: AIG, CEO Robert Benmosche

Company Type: Insurance Systemic Risk Percentage: 6.57% Equity Risk: 2.79 Marginal Expected Shortfall: 2.58 Source: NYU Stern

Ranking 6: Fannie Mae, CEO Mike Williams

Company Type: Mortgage Industry (GSE) Systemic Risk Percentage: 8.82% Equity Risk: 4.4 Marginal Expected Shortfall: 5.06 Source: NYU Stern

Ranked 5: Freddie Mac, CEO Charles Haldeman

Company Type: Mortgage Industry (GSE) Systemic Risk Percentage: 9.18% Equity Risk: 4.75 Marginal Expected Shortfall: 5.71 Source: NYU Stern

Ranked 4: JP Morgan Chase, CEO Jamie Dimon

Image: ap

Company Type: Depositories Systemic Risk Percentage: 10.42% Equity Risk: 4.12 Marginal Expected Shortfall: 5.35 Source: NYU Stern

Ranked 3: Goldman Sachs, CEO Lloyd Blankfein

Company Type: Broker Dealer Systemic Risk Percentage: 10.56% Equity Risk: 7.32 Marginal Expected Shortfall: 9.77 Source: NYU Stern

Ranked 2: Citigroup, CEO Vikram Pandit

Company Type: Depositories Systemic Risk Percentage: 15.52% Equity Risk: 5.18 Marginal Expected Shortfall: 7.38 Source: NYU Stern

Ranked 1: Bank of America, CEO Brian Moynihan

Company Type: Depositories Systemic Risk Percentage: 15.83% Equity Risk: 4.21 Marginal Expected Shortfall: 5.47 Source: NYU Stern

Now Check Out The 20 Winners And Losers From The Goldman SEC Charges

See the winners and losers here >