Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

*Positive Operating Jaws: China Everbright Bank (6818.HK) [CEB] reported 1Q21 results of CNY 11.5 bn, increasing CNY 3.3 bn (40.1%) linked quarter. When we exclude securities gains, results were less robust coming in at CNY 8.5 bn, but still improving CNY 1.8 bn (27.4%). Results were driven by CEB’s positive operating jaws, as revenues improved CNY 2.6 bn (7.7%) while costs declined CNY 660 mn (6.1%); and*Credit Wall Continues To Grow: Net new problem loans continue to accelerate at Indian bank pace of CNY 11.5 bn or 110.8% on an annualized basis. By our calculation, reserve are short in the neighborhood of CNY 103 mn which represents about three years of 1Q20 core operating results. Provided (and its not a stretch) that the net new NPL ratio trajectory holds, reserve cover of NPLs will drop to 77%.

*Positive Operating Jaws: China Everbright Bank (6818.HK) [CEB] reported 1Q21 results of CNY 11.5 bn, increasing CNY 3.3 bn (40.1%) linked quarter. When we exclude securities gains, results were less robust coming in at CNY 8.5 bn, but still improving CNY 1.8 bn (27.4%). Results were driven by CEB’s positive operating jaws, as revenues improved CNY 2.6 bn (7.7%) while costs declined CNY 660 mn (6.1%); and*Credit Wall Continues To Grow: Net new problem loans continue to accelerate at Indian bank pace of CNY 11.5 bn or 110.8% on an annualized basis. By our calculation, reserve are short in the neighborhood of CNY 103 mn which represents about three years of 1Q20 core operating results. Provided (and its not a stretch) that the net new NPL ratio trajectory holds, reserve cover of NPLs will drop to 77%. 

China Everbright Bank – Credit Remains Troublesome

Bond market data and technology, BondEvalue

BondEvalue

Bond market data and technology

BondEvalue is a Singapore-based Fintech that specializes in bond market data and technology. The company's information services business offers bond market data on hard-currency corporate & sovereign bonds across Asia, Middle East, Europe and the Americas. The data, which includes bond prices, yields, news and analytics, is offered to end investors via interactive Mobile and Web Apps. Investors can sign up for a free trial of the service either via the company's website (https://bondevalue.com) or by downloading the BondEvalue Mobile App (http://onelink.to/wej7jq). BondEvalue is also developing an electronic bond exchange, BondbloX in Singapore that allows investors to trade bonds electronically in smaller sizes (US$1,000 or equivalent). For more information, visit https://www.bondblox.com/

Bond Market Data and Technology

Credit

The risk-on risk-off (RORO) sentiment continues as US equities fell again on Wednesday with the S&amp;P down 1.3% and Nasdaq down 2.7% falling just below 13k. US 10Y Treasury yields rose by 8bp towards 1.5% after trading largely flat for three days despite the risk-off tone. US ISM Services PMI disappointed at 55.3 vs. expectations of 58.7 while ADP private sector payrolls rose by 117k, disappointing forecasts of 177k. Europe’s FTSE, DAX and CAC outperformed, up 0.9%, 0.3% and 0.4%. US IG CDS spreads were 1.2bp wider and HY was 5.7bp wider. EU main CDS spreads widened 0.4bp and crossover spreads widened 2.2bp. Asian equity markets are down over 0.5% and Asia ex-Japan CDS spreads are tighter by 0.3bp.

Everbright Launches $ Bond; Macro; Rating Changes; New Issues; Talking Heads; Top Gainers & Losers

Thematic (Sector/Industry)

*D-SIB Standards Released: The People’s Bank of China (PBOC) and China Bank and Insurance Regulatory Commission (CBIRC) on December 3, 2020 released finalized standards for the country’s domestic systemically important banks (D-SIBs), and indicated that tighter regulations will be announced shortly; and* Aggressive Capital Raises Expected: In our view, the forthcoming regulations are likely to focus on: additional paid-in capital; leverage ratios; risk concentrations; corporate governance; disclosure levels; and mechanism to prevent systemic risk; and internal controls. The idea is to finally strengthen mainland Chinese bank balance sheets and improve their loss absorption capacity. Problem for equity raises is that P/BV must be over 1.0x for the raise and many of the potential D-SIBs are trading below book value.

*D-SIB Standards Released: The People’s Bank of China (PBOC) and China Bank and Insurance Regulatory Commission (CBIRC) on December 3, 2020 released finalized standards for the country’s domestic systemically important banks (D-SIBs), and indicated that tighter regulations will be announced shortly; and* Aggressive Capital Raises Expected: In our view, the forthcoming regulations are likely to focus on: additional paid-in capital; leverage ratios; risk concentrations; corporate governance; disclosure levels; and mechanism to prevent systemic risk; and internal controls. The idea is to finally strengthen mainland Chinese bank balance sheets and improve their loss absorption capacity. Problem for equity raises is that P/BV must be over 1.0x for the raise and many of the potential D-SIBs are trading below book value. 

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<div>In keeping with the day of the week and date, we look at some charts of short interest and price for stocks from Korea, Taiwan and Hong Kong.</div><div>These stocks have seen a large upward move in short interest accompanied by big price moves and could be candidates for a stock collapse or squeeze.</div>

In keeping with the day of the week and date, we look at some charts of short interest and price for stocks from Korea, Taiwan and Hong Kong.These stocks have seen a large upward move in short interest accompanied by big price moves and could be candidates for a stock collapse or squeeze.

Asia Short Interest - Friday the 13th Edition

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Last Week in Event SPACE: WorleyParsons, UNIZO, Adani Gas, ERM, Dah Chong, Toshiba, China Everbright

Hong Kong

China Everbright Limited, through its subsidiaries, provides investment banking, commercial banking, corporate finance, and investment advisory services.  The Company also invests in properties and provides insurance, brokerage, secretarial, and money lending services.

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

China Everbright (165 HK)

China Everbright Bank – Credit Remains Troublesome

CHINA EVERBRIGHT BANK: Operating results grew 27.4% QOQ, driven by positive operating jaws. Credit continues to weaken and the loss reserve...

Thomas J. Monaco

Everbright Launches $ Bond; Macro; Rating Changes; New Issues; Talking Heads; Top Gainers & Losers

The risk-on risk-off (RORO) sentiment continues as US equities fell again on Wednesday with the S&P down 1.3% and Nasdaq down 2.7% falling just...

BondEvalue

China Banks – About Time

CHINA BANKS: PBOC and CBIRC Released Finalized D-SIB Standards and Indicated Tighter Regulations. Aggressive Capital Raises Are Expected.

Thomas J. Monaco

Asia Short Interest - Friday the 13th Edition

In keeping with the day of the week and date, we look at some charts of short interest and price for stocks from Korea, Taiwan and Hong Kong.These...

Brian Freitas

Last Week in Event SPACE: WorleyParsons, UNIZO, Adani Gas, ERM, Dah Chong, Toshiba, China Everbright

Last Week in Event SPACE ... WorleyParsons Ltd (WOR AU) petitions FIRB to decide whether Dar Group is abusing the creeper rule. The Unizo...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)