Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

Thematic (Sector/Industry)

<ul>
<li>We look at which Japan banks have the most cash which can see a major boost to returns. </li>
<li>Banks with lower margins can see a higher net interest income pick up from rising rates. </li>
<li>Loan growth in Japan has been relatively strong, supportive of rising rates from BOJ.</li>
</ul>


We look at which Japan banks have the most cash which can see a major boost to returns. 
Banks with lower margins can see a higher net interest income pick up from rising rates. 
Loan growth in Japan has been relatively strong, supportive of rising rates from BOJ.


Japan - Rising Rates: Focus On Banks With High Cash And Low Margins

Equity Bottom-Up

<ul>
<li>Only about 1/3 of of the recently announced share buy back is done, the remainder will come from now through end of March 2024. </li>
<li>Earnings are far higher than the bank's forecast, and there should be a major revision in coming weeks. </li>
<li>Credit Saison collaboration and exiting BOJ negative rate policy, should provide a multitude of positives, for revenue growth.</li>
</ul>


Only about 1/3 of of the recently announced share buy back is done, the remainder will come from now through end of March 2024. 
Earnings are far higher than the bank's forecast, and there should be a major revision in coming weeks. 
Credit Saison collaboration and exiting BOJ negative rate policy, should provide a multitude of positives, for revenue growth.


Suruga Bank - Only 33% of Buyback Done, Profit Guidance to Rise a Lot, Credit Saison Support Growth

<ul>
<li>There is no easy way to gather duration data of securities held by Japan's regional banks</li>
<li>In IR material of the largest 8 regional banks, Resona and Chiba stand out, at opposite ends</li>
<li>On blunt equity/assets SBI Sumishin Net Bank stands out at only 1.5%</li>
</ul>


There is no easy way to gather duration data of securities held by Japan's regional banks
In IR material of the largest 8 regional banks, Resona and Chiba stand out, at opposite ends
On blunt equity/assets SBI Sumishin Net Bank stands out at only 1.5%


Resona & Chiba - Duration Longest at Resona, Shortest at Chiba, Implications for YCC Relief

<ul>
<li>What's new is that Japan's domestic credit growth is accelerating, and it's now better than in Singapore, for instance; accelerating to 2.51% YoY in July from 0.77% February low</li>
<li>Loan growth and higher JGB yields, both matter for net interest income, and margins. Two year JGB yields are 0.035% on 22 September compared with -0.075% on 30 June.</li>
<li>Profit delta can rise further for Japan's banks due to better NPLs, with the largest banks' credit costs/loans moving to 5bps in 1Q24, vs 21bps in 4Q22, 11bps in 1Q23</li>
</ul>


What's new is that Japan's domestic credit growth is accelerating, and it's now better than in Singapore, for instance; accelerating to 2.51% YoY in July from 0.77% February low
Loan growth and higher JGB yields, both matter for net interest income, and margins. Two year JGB yields are 0.035% on 22 September compared with -0.075% on 30 June.
Profit delta can rise further for Japan's banks due to better NPLs, with the largest banks' credit costs/loans moving to 5bps in 1Q24, vs 21bps in 4Q22, 11bps in 1Q23


Japan Banks - Accelerating Domestic Credit | JGB Yields Higher | Provisions -79% QoQ & -58% YoY

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

<ul>
<li>The Bank of Japan has raised its short-term interest rate to 0.25% from 0.1% ahead of the core of consensus expectations, and BoJ plans to pare back purchases of JGBs</li>
<li>We focus on those big-cap Japanese banks that are well geared into higher domestic rates through loan books and BoJ deposits, that also have lesser exposure to rising JGB yields</li>
<li>We stay broadly positive on Japanese bank shares, despite their performance; we add Chiba to the buy list of Resona, Mizuho, SMFG and Concordia, whilst keeping Kyoto as a sell</li>
</ul>


The Bank of Japan has raised its short-term interest rate to 0.25% from 0.1% ahead of the core of consensus expectations, and BoJ plans to pare back purchases of JGBs
We focus on those big-cap Japanese banks that are well geared into higher domestic rates through loan books and BoJ deposits, that also have lesser exposure to rising JGB yields
We stay broadly positive on Japanese bank shares, despite their performance; we add Chiba to the buy list of Resona, Mizuho, SMFG and Concordia, whilst keeping Kyoto as a sell


Japanese Big-Cap Banks – Rates Story Takes Centre Stage, Along with Banks’ JGB Exposure

Japan

The Chiba Bank, Ltd. is a regional bank based in Chiba Prefecture. The Bank offers general banking services including deposits, loans, and foreign exchange transactions. The Chiba Bank also develops software and provides financial services such as leasing, securities brokerage, letter of credit, and credit cards.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Chiba Bank (8331 JP)

Japan - Rising Rates: Focus On Banks With High Cash And Low Margins

With BOJ shifting its interest rate policy there can be vast differences with banks that have high cash holdings and banks with relatively low...

Daniel Tabbush

Suruga Bank - Only 33% of Buyback Done, Profit Guidance to Rise a Lot, Credit Saison Support Growth

Suruga Bank has done ~33% of its recent share buyback, the rest will come through March. The bank has earned far above its guidance, expect profit...

Daniel Tabbush

Resona & Chiba - Duration Longest at Resona, Shortest at Chiba, Implications for YCC Relief

With rising yields on 10 year JGBs and on 1 year JGBs it is worth re-visting the stand outs in duration, Resona and Chiba.

Daniel Tabbush

Japan Banks - Accelerating Domestic Credit | JGB Yields Higher | Provisions -79% QoQ & -58% YoY

Japan's banks are seeing accelerating domestic credit growth, better than Singapore now. JGB yields remain higher than in the past, credit costs...

Daniel Tabbush

Japanese Big-Cap Banks – Rates Story Takes Centre Stage, Along with Banks’ JGB Exposure

Bank of Japan raises short-term interest rate to 0.25%, plans to reduce JGB purchases. We like Resona, Mizuho, SMFG, Concordia big-cap bank shares...

Victor Galliano

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan - Rising Rates: Focus On Banks With High Cash And Low Margins

With BOJ shifting its interest rate policy there can be vast differences with banks that have high cash holdings and banks with relatively low...

Daniel Tabbush

Suruga Bank - Only 33% of Buyback Done, Profit Guidance to Rise a Lot, Credit Saison Support Growth

Suruga Bank has done ~33% of its recent share buyback, the rest will come through March. The bank has earned far above its guidance, expect profit...

Daniel Tabbush

Resona & Chiba - Duration Longest at Resona, Shortest at Chiba, Implications for YCC Relief

With rising yields on 10 year JGBs and on 1 year JGBs it is worth re-visting the stand outs in duration, Resona and Chiba.

Daniel Tabbush

Japan Banks - Accelerating Domestic Credit | JGB Yields Higher | Provisions -79% QoQ & -58% YoY

Japan's banks are seeing accelerating domestic credit growth, better than Singapore now. JGB yields remain higher than in the past, credit costs...

Daniel Tabbush

Japanese Big-Cap Banks – Rates Story Takes Centre Stage, Along with Banks’ JGB Exposure

​Bank of Japan raises short-term interest rate to 0.25%, plans to reduce JGB purchases. We like Resona, Mizuho, SMFG, Concordia big-cap bank shares...

Victor Galliano

Bank of Japan raises short-term interest rate to 0.25%, plans to reduce JGB purchases. We like Resona, Mizuho, SMFG, Concordia big-cap bank shares...