Head to Head Contrast: ABN AMRO Bank (OTCMKTS:AAVMY) versus Bank of China (OTCMKTS:BACHY)

ABN AMRO Bank (OTCMKTS:AAVMY) and Bank of China (OTCMKTS:BACHY) are both large-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, profitability, risk, valuation, earnings and analyst recommendations.

Valuation & Earnings

This table compares ABN AMRO Bank and Bank of China”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ABN AMRO Bank	$19.04 billion	2.03	$2.30 billion	$3.24	14.55
Bank of China	$169.73 billion	1.47	$33.81 billion	$2.61	7.40

Bank of China has higher revenue and earnings than ABN AMRO Bank. Bank of China is trading at a lower price-to-earnings ratio than ABN AMRO Bank, indicating that it is currently the more affordable of the two stocks.

Dividends

ABN AMRO Bank pays an annual dividend of $1.19 per share and has a dividend yield of 2.5%. Bank of China pays an annual dividend of $0.63 per share and has a dividend yield of 3.3%. ABN AMRO Bank pays out 36.7% of its earnings in the form of a dividend. Bank of China pays out 24.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Bank of China is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares ABN AMRO Bank and Bank of China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ABN AMRO Bank	14.22%	9.12%	0.56%
Bank of China	20.44%	7.88%	0.68%

Analyst Recommendations

This is a summary of recent ratings for ABN AMRO Bank and Bank of China, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ABN AMRO Bank	0	1	6	1	3.00
Bank of China	0	1	0	0	2.00

Summary

ABN AMRO Bank beats Bank of China on 7 of the 13 factors compared between the two stocks.

About ABN AMRO Bank

ABN AMRO Bank N.V. provides various banking products and financial services to retail, private, and business clients in the Netherlands and internationally. It operates through three segments: Personal & Business Banking, Wealth Management, and Corporate Banking. The company provides savings and deposits products; investment and insurance products; and consumer, personal, car, and home improvement loan. It also issues, promotes, manages, and processes credit cards; trade finance, international payments, and treasury management; corporate finance and equity capital market; and revolving credit card facilities and pension schemes, as well as consumer credit and mortgages; and life and non-life insurance products. In addition, it offers asset-based solutions, including working capital solutions, equipment leases and loans, and vendor lease services; private banking and wealth-management-related services; and derivatives and equity clearing services. The company was incorporated in 2009 and is headquartered in Amsterdam, the Netherlands. ABN AMRO Bank N.V. operates as a subsidiary of Stichting Administratiekantoor Continuïteit Abn Amro Bank.

About Bank of China

Bank of China Limited, together with its subsidiaries, provides various banking and financial services in Chinese Mainland, Hong Kong, Macao, Taiwan, and internationally. It operates through six segments: Corporate Banking, Personal Banking, Treasury Operations, Investment Banking, Insurance, and Other. The Corporate Banking segment provides current accounts, deposits, overdrafts, loans, payments and settlements, trade-related products, and other credit facilities, as well as foreign currency, derivative, and wealth management products for corporate customers, government authorities, and financial institutions. The Personal Banking segment offers savings deposits, personal loans, credit cards and debit cards, payments and settlements, wealth management, and funds and insurance agency services to retail customers. The Treasury Operations segment offers foreign exchange transactions, customer-based interest rate, and foreign exchange derivative transactions, as well as money market transactions, proprietary trading, and asset and liability management. The Investment Banking segment provides debt and equity underwriting and financial advisory, sale and trading of securities, stock brokerage, investment research, asset management services, and private equity investment services. The Insurance segment provides underwriting services for general and life insurance business, and insurance agency services. In addition, the company operates debt-to-equity swaps and other supporting, and aircraft and financial leasing business. The company was founded in 1912 and is headquartered in Beijing, China.