Canada's no. 1 bank is not a bank at all. According to The Banker magazine's 2019 ranking of major Canadian financial institutions, Desjardins comes out on top. The article from the prestigious financial journal not only highlights our outstanding performance, but also attests to our financial strength and our ability to weather the economic consequences of the pandemic. At Desjardins, we owe this acknowledgement to our strong fundamentals and to the relationships we have been building with members and clients since 1900. This is how--and why--Desjardins earned the no. 1 ranking this year.
Each year, British magazine The Banker, a publication owned by The Financial Times, ranks the top 1,000 financial institutions in the world. This year, we are proud to announce that Desjardins has come out on top in Canada, on the back of our 2019 financial performance. In fact, our financial cooperative leads Canada's 5 major banks, earning top score for 6 of the 8 performance indicators: growth, profitability, asset quality, return on risk, soundness and leverage.*
Desjardins owes this world-class financial strength to our capitalization, which amounts to more than $25 billion. This is calculated based on the Tier 1 capital ratio, which helps determine the financial reserves available to cope with unexpected events and support business growth. According to The Banker, Desjardins's ratio roundly outpaced other banks in 2019. Most major Canadian banks maintain a ratio of approximately 12%, whereas our Tier 1 capital ratio was 21.6% as at December 31, 2019 (compared to 17.6% in 2018), which is very high.
The analysis also suggests that Desjardins's cooperative model puts us in a better position than our peers to weather the economic consequences of the coronavirus pandemic. The magazine goes on to state that Desjardins is relying less on wholesale funding--one of the main sources of financing for Canadian banks--which can be particularly volatile during times of crisis.*
Experience you can count on
Our financial strength also comes from 120 years of experience as a partner that Canadians can trust. And we put that experience to work serving Canadian members and clients in caisses across Ontario and Quebec, and in the Desjardins Insurance and Wealth Management networks. At Desjardins, we believe we benefit as a society when we enrich the lives of people and communities--a principle that is at the heart of our unique cooperative model, and one that The Banker recognizes: "While the country's top names have a typical banking structure and capital that belongs to shareholders, as a federation of credit unions, Desjardins is ultimately owned by its customers."*
In the current context, that cooperative spirit shines through in our sustained support for individuals and business owners alike. Relief measures, solutions offered in partnership with the government, support for regional development and economic recovery--every initiative we have put forward relies on the strength of our communities and is guided by careful, responsible management.
Desjardins's solid financial footing has also shone through in the encouraging financial results over the first 9 months of 2020. Despite the impact of the pandemic, Desjardins remains a financial institution with incredibly strong fundamentals and the ability to withstand the repercussions of an economic downturn. We will never fail to be there for our members and clients. As proof, operating income for Desjardins's first 9 months of 2020 amounted to $13.56 billion, up $628 million or 4.9% compared to the same period last year. We have also maintained a solid capital base, with a total capital ratio of 22.1%, compared to 21.6% as at December 31, 2019. And we're expecting to return $314 million to members and the community for the first 9 months of 2020, compared to $323 million for the same period in 2019.
Always looking to the future
To help boost the economy and get our communities back on their feet, Desjardins is committed to supporting members and clients now more than ever. As early as April, we announced various strategies to help local businesses and community organizations. That has included the GoodSpark Fund, a $150 million investment fund to finance projects supporting youth, sustainable development and entrepreneurship into 2024.
Desjardins has also launched the Aequitas fund to support developing countries. The $50 million private equity fund focuses on impact finance and will promote financial inclusion to fight for gender equality, combat climate change and contribute to achieving other Sustainable Development Goals.
Our cooperative is taking a stance on initiatives that affect our society as a whole, like Black Lives Matter. In July, we joined the BlackNorth Initiative along with 300 Canadian organizations committed to implementing concrete initiatives against anti-Black systemic racism.
For their part, Desjardins Insurance and its network of agents decided to help out Canadian food banks, which have seen food donations drop off during the pandemic. All in all, they donated more than $327,000 to Food Banks Canada and to food banks in Alberta, Ontario and New Brunswick.
As our ranking by The Banker can attest, Desjardins continues to stand out from our peers. Our unique cooperative model is more relevant than ever. And in these particularly trying times, in Canada and across the globe, the undeniable strength of Canada's leading cooperative financial group is something our members and clients can continue to count on.
*Source: Silvia Pavoni. "Top 1000 World Banks - Desjardins out in front of Canadian field." The Banker, July 2020.