By Yap Leng Kuen, the StarOnline

DESPITE the collapse of banks in major Western financial centres, Asian and Australian banks continue to shine.

Malayan Banking Bhd (Maybank) bagged the 13th spot in Bloomberg Markets magazine third annual ranking of the world's strongest banks recently.

It was the first time a Malaysian bank had earned such an accolade.

Maybank, however, has not been swayed by the limelight. The focus is still on serious matters such as risk strategies, regional strength and stress testing.

Australia's four major banks Australia and New Zealand Banking Group, National Australia Bank, Commonwealth Bank of Australia and Westpac Banking Corp are on track for a combined record first-half cash profits of more than A$13bil (RM39.47bil), reports the South China Morning Post.

These Australian banks are competing for investors by offering high dividends, although analysts believe they are overvalued, says the report.

This vibrant earnings picture pales when compared to that of some British banks that are, in fact, being rescued by taxpayers' money.

At the Royal Bank of Scotland (RBS), the profit for the three months of the year compares to a £1.5bil (RM6.94bil) loss in the same period in 2012 and a £2.2bil loss in the final quarter of last year, largely as a result of a fall in impairments in losses from RBS' “bad bank”, reports The Telegraph.

Lloyds Banking Group saw an increase in statutory pre-tax profits for the first quarter to £2.04bil, compared to a profit for the final three months of last year of just £1mil, the report adds.

While Asian banks experienced their difficulties in the 1997 Asian financial crisis, the major US and British banks that collapsed had to be rescued following the 2008 financial and subsequent debt crises.

The next question now is sustainability.

Having come so far from the crisis days of more than a decade ago, banks like Maybank will fight hard to maintain their flagship positions.

New stress-testing methods and an intense focus on risk management in its various forms are some elements that have been put in place.

Competitive positioning is constantly taking place.

There are many other ways that Maybank tries to strengthen itself, for example, by making sure that 30% of its earnings comes from overseas.

The parameters for assessment of strength will probably change over time, especially as consumers become more discerning.

Survey samples will probably have to be wider and information sought more in-depth.

It may no longer be as simple as meeting a few standards but a whole range of quantitative and qualitative indicators.

In this context, what happens behind the smile at the counter matters a lot.

Ernst & Young, in its survey of corporate executives using banks, said it sought more information on risk profiles and wanted banks to be more transparent, reports StarBiz.

The challenge for banks is to see how they can accede to these requests, as they aim to be the regional bank of choice for these corporates.

In another survey, Ernst & Young cited corporate executives as saying that banks were still taking on too much risk.

“The lingering after-effects of the 2008 financial crisis and the ongoing challenges in the eurozone have forced corporations to focus on the stability of their core banking teams.

“Counterparty risk and exposure from banks have become heightened concerns for large corporates,” Steven Lewis, a global banking analyst at Ernst & Young, told The Telegraph.

The scope of responsibility is widening for banks as they come under scrutiny from more parties.