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.

Equity Bottom-Up

Australia & New Zealand Bankin / Equity Bottom-Up

ANZ’s most important Asian investments are AMMB, Bank Pan Indonesia, Shanghai Rural Commercial Bank and Bank of Tianjin.  The idea of emphasizing Asia, where home markets Australia and New Zealand are mature, is a positive differentiation to peer banks. But the reality is there does not appear to be a meaningful boost to ANZ income. More complete data on these associates can be found at the end of this note, from ANZ's latest annual report.Profit from associates (AUS$m) - ANZ<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/010/820/original/Image%201%20-%20Profit%20from%20associates.png?1469499480" class="editor-image img-responsive" data-smartkarma-image-id="10820"><figcaption class="figcaption">Source: SNL</figcaption></figure>…

ANZ’s most important Asian investments are AMMB, Bank Pan Indonesia, Shanghai Rural Commercial Bank and Bank of Tianjin.  The idea of emphasizing Asia, where home markets Australia and New Zealand are mature, is a positive differentiation to peer banks. But the reality is there does not appear to be a meaningful boost to ANZ income. More complete data on these associates can be found at the end of this note, from ANZ's latest annual report.Profit from associates (AUS$m) - ANZSource: SNL…

ANZ's Asian Emphasis Does Not Seem to Support Profit, Returns

Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

Morningstar provides data on more than 500,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 16 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement or management as of June 30, 2015. We have operations in 27 countries.

Download the Morningstar Fact Sheet : http://corporate.morningstar.com/US/documents/MarketingFactSheets/AboutMorningstarFactsheet.pdf

Thematic (Sector/Industry)

Melbourne-based research house Roy Morgan Research’s consumer banking customer satisfaction report for June 2016 identifies <a href="https://www.smartkarma.com/entities/14" target="_blank" data-smartkarma-citation="entities:14" rel="noopener">Commonwealth Bank Of Australia (CBA AU)</a> as the clear leader among the major banks with 81.2% of personal customers either “very satisfied” or “fairly satisfied.” Next best is <a href="https://www.smartkarma.com/entities/443" target="_blank" data-smartkarma-citation="entities:443" rel="noopener">Aust And Nz Banking Group (ANZ AU)</a> at 78.9%, followed by <a href="https://www.smartkarma.com/entities/444" target="_blank" data-smartkarma-citation="entities:444" rel="noopener">Westpac Banking Corp (WBC AU)</a> at 78.1% and <a href="https://www.smartkarma.com/entities/15" target="_blank" data-smartkarma-citation="entities:15" rel="noopener">National Australia Bank Ltd (NAB AU)</a> at 78.0%.
In our opinion, there is a clear link between satisfied customers and consumer banking profitability. Despite increasing competition, the major banks have maintained dominant positions in consumer banking during the past 10 years.
Analyst: David Ellis

Melbourne-based research house Roy Morgan Research’s consumer banking customer satisfaction report for June 2016 identifies Commonwealth Bank Of Australia (CBA AU) as the clear leader among the major banks with 81.2% of personal customers either “very satisfied” or “fairly satisfied.” Next best is Aust And Nz Banking Group (ANZ AU) at 78.9%, followed by Westpac Banking Corp (WBC AU) at 78.1% and National Australia Bank Ltd (NAB AU) at 78.0%.
In our opinion, there is a clear link between satisfied customers and consumer banking profitability. Despite increasing competition, the major banks have maintained dominant positions in consumer banking during the past 10 years.
Analyst: David Ellis

Major Bank Retail Customer Satisfaction Declines, but Still a Remarkably High 79.5%

As a consequence of increasing global risks, tougher regulatory demands, intensifying pressure on net interest margins, higher bad debts and lower than expected returns on equity we reduce earnings forecasts, fair value estimates and rebase medium- to longer-term dividend payout ratios lower to more sustainable long-term levels for three of the four wide moat-rated Australian banks: Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corporation. We cut Australia and New Zealand Banking Group's earnings forecasts and fair value estimate in March 2016 and now rebase its longer-term dividend payout ratio lower. Our preferred banks are the big retail-focused, New South Wales-based, banks Westpac and Commonwealth Bank due to their lower risk profiles, higher ROEs, higher NIMs, lower cost/income ratios, consistently lower-loan-loss rates, less volatility in earnings, and larger exposures to the strongly performing New South Wales economy.Analyst: David Ellis

As a consequence of increasing global risks, tougher regulatory demands, intensifying pressure on net interest margins, higher bad debts and lower than expected returns on equity we reduce earnings forecasts, fair value estimates and rebase medium- to longer-term dividend payout ratios lower to more sustainable long-term levels for three of the four wide moat-rated Australian banks: Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corporation. We cut Australia and New Zealand Banking Group's earnings forecasts and fair value estimate in March 2016 and now rebase its longer-term dividend payout ratio lower. Our preferred banks are the big retail-focused, New South Wales-based, banks Westpac and Commonwealth Bank due to their lower risk profiles, higher ROEs, higher NIMs, lower cost/income ratios, consistently lower-loan-loss rates, less volatility in earnings, and larger exposures to the strongly performing New South Wales economy.Analyst: David Ellis

Challenges Mount for the Wide Moat-Rated Australian Banks

Global Asset Allocation, Politics & Governance, Ecstrat

John-Paul Smith

Global Asset Allocation, Politics & Governance

Ecstrat

Ecstrat is a consultancy advising on asset allocation between global equity markets, with a focus on the intersection of governments, geopolitics, governance and markets.
 
Over the past few years and more especially since the Great Financial Crisis (GFC), investors have become more focused on short-term market movements and real-time returns and have consequently neglected the analysis of the underlying structural themes that underpin longer term performance.
​
More specifically we believe that the evolution of governance-based relationships between investors, controlling shareholders, labour and the state is one of the primary determinants of both relative and absolute performance between individual equity markets.
 
We will endeavour to provide investors with some of the context surrounding governance-related issues which encompass many different disciplines including history, economics and political science, as well as the financial metrics which are the most obvious manifestation of the structural characteristics of each market.
 
We will pay particular attention to the shifts and potential inflection points for governance in individual markets as these are often the best lead indicators for both economic and market performance.

Cross Asset Strategy

In this brief piece we take a considered stance on the likelihood of Brexit actually proceeding in the wake of June’s referendum and examine some of the strategic implications for equity investors in terms of the potential shifts in sovereign and corporate governance.

In this brief piece we take a considered stance on the likelihood of Brexit actually proceeding in the wake of June’s referendum and examine some of the strategic implications for equity investors in terms of the potential shifts in sovereign and corporate governance.

Founder and CEO, Europacifica Consulting

Naomi Fink

Founder and CEO

Europacifica Consulting

Macroeconomics

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/009/868/original/Chart2.Australia.Risk_.Pref_.png?1467594254" class="editor-image img-responsive" data-smartkarma-image-id="9868"><figcaption class="figcaption">Australians risk-averse? Not today, mate (Source: Europacifica)</figcaption></figure> Speculation that Australia will lose its <a href="http://www.afr.com/news/politics/election/election-2016-the-trafficjam-political-culture-threatening-aaa-credit-rating-20160703-gpxil9" target="_blank">AAA rating</a> due to political deadlock at the polls has probably been enhanced by <a href="http://www.telegraph.co.uk/business/2016/06/27/george-osborne-to-speak-in-attempt-to-calm-markets-following-bre/" target="_blank">the final downgrade</a> to the UK's own rating, motivated by the recent EU referendum.  Medium-term, the "lucky country" might very well escape the fate of capital flight, given there are many more controversial events (such as US elections) that affect Australia little. Whenever appetite for risk revives…

Australians risk-averse? Not today, mate (Source: Europacifica) Speculation that Australia will lose its AAA rating due to political deadlock at the polls has probably been enhanced by the final downgrade to the UK's own rating, motivated by the recent EU referendum.  Medium-term, the "lucky country" might very well escape the fate of capital flight, given there are many more controversial events (such as US elections) that affect Australia little. Whenever appetite for risk revives…

Australia

Commonwealth Bank of Australia provides banking, life insurance, and related services for individuals, small businesses and medium sized commercial enterprises. The Bank provides corporate and general banking, international financing, institutional banking and stock broking and funds management such as superannuation product.

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

Commonwealth Bank of Australia (CBA AU)

ANZ's Asian Emphasis Does Not Seem to Support Profit, Returns

ANZ’s most important Asian investments are AMMB, Bank Pan Indonesia, Shanghai Rural Commercial Bank and Bank of Tianjin. The idea of emphasizing...

Daniel Tabbush

Major Bank Retail Customer Satisfaction Declines, but Still a Remarkably High 79.5%

Melbourne-based research house Roy Morgan Research’s consumer banking customer satisfaction report for June 2016 identifies Commonwealth Bank Of...

Morningstar, Inc.

Challenges Mount for the Wide Moat-Rated Australian Banks

As a consequence of increasing global risks, tougher regulatory demands, intensifying pressure on net interest margins, higher bad debts and lower...

Morningstar, Inc.

Brexit; Unintended Consequences

In this brief piece we take a considered stance on the likelihood of Brexit actually proceeding in the wake of June’s referendum and examine some...

John-Paul Smith

Australia a Risk Haven? Not Today, Mate

Speculation that Australia will lose its AAA rating due to political deadlock at the polls has probably been enhanced by the final downgrade to...

Naomi Fink

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)