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

Thematic (Sector/Industry)

*Out of Control Credit Risk: High yield credit risk is out of control at 5% of global GDP just as credit metrics at the top of the market are exhibiting vulnerabilities.*Other Credit Challenges Ahead: Areas such as student lending, sub-prime auto, credit cards, Alt-A /home equity loans, securities-based lending , commercial MBS, and non-financial debt also pose global financial sector vulnerabilities.<h2>Investment Summary</h2>American bank CEOs argue that the leverage lending market is healthy due to…

*Out of Control Credit Risk: High yield credit risk is out of control at 5% of global GDP just as credit metrics at the top of the market are exhibiting vulnerabilities.*Other Credit Challenges Ahead: Areas such as student lending, sub-prime auto, credit cards, Alt-A /home equity loans, securities-based lending , commercial MBS, and non-financial debt also pose global financial sector vulnerabilities.Investment SummaryAmerican bank CEOs argue that the leverage lending market is healthy due to…

Systemic Leverage Risk Has Returned In Full Force

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.

Generally, it is Asean banks where net interest margins (NIM) have seen the best change over the past two years. And for many, this continues in 1Q18. What makes this reality more powerful is that their absolute NIM levels are also the highest in the region. Vietnam, Thailand and Indonesia, all top the list for better margins over the past two years at +22bps to +33bps. It is notable that Indonesia features here, as most will recall the hysteria that comes almost annually from analysts in…

Generally, it is Asean banks where net interest margins (NIM) have seen the best change over the past two years. And for many, this continues in 1Q18. What makes this reality more powerful is that their absolute NIM levels are also the highest in the region. Vietnam, Thailand and Indonesia, all top the list for better margins over the past two years at +22bps to +33bps. It is notable that Indonesia features here, as most will recall the hysteria that comes almost annually from analysts in…

Asian Banks – Margin Disparity Favors Asean

Equity Bottom-Up

* Unchallenged 1Q18 Result: The Group posted a weak 1Q18 result, to which no analysts really challenged.* No Subsidiary Discussion Was Had: HSBC NA still remains a massive earnings drag to overall Group profitability - chronically being unable to break-even on an operating basis.* Time to Dispose of This Mess: HSBC NA franchise remains plagued by the legacy Household International (acquired 2003) fiasco. After disposing of its higher yielding assets, HSBC NA cannot earn money at this subsidiary…

* Unchallenged 1Q18 Result: The Group posted a weak 1Q18 result, to which no analysts really challenged.* No Subsidiary Discussion Was Had: HSBC NA still remains a massive earnings drag to overall Group profitability - chronically being unable to break-even on an operating basis.* Time to Dispose of This Mess: HSBC NA franchise remains plagued by the legacy Household International (acquired 2003) fiasco. After disposing of its higher yielding assets, HSBC NA cannot earn money at this subsidiary…

HSBC Holdings Plc – Full of Buffalo-Ney

Stewart Paterson

A recent Bloomberg article titled "China's about to give global finance the chance of a lifetime" made me smile. In the article Bloomberg predicts that in the thirteen years between 2017 and 2030 foreign bank assets will rise from RMB 3.2 Trillion to RMB 18.8 Trillion (a CAGR of 15%) taking their market share from 1.3% to 3.1%. The underlying assumption seems to be that total bank assets will grow at a CAGR of 7%. Given bank assets currently equal about 3x GDP, one assumes that 7% is also the…

A recent Bloomberg article titled "China's about to give global finance the chance of a lifetime" made me smile. In the article Bloomberg predicts that in the thirteen years between 2017 and 2030 foreign bank assets will rise from RMB 3.2 Trillion to RMB 18.8 Trillion (a CAGR of 15%) taking their market share from 1.3% to 3.1%. The underlying assumption seems to be that total bank assets will grow at a CAGR of 7%. Given bank assets currently equal about 3x GDP, one assumes that 7% is also the…

Money Matters: Chinese Financial System Opening Up- The Chance of a Lifetime?

<a href="https://www.smartkarma.com/entities/516" target="_blank" data-smartkarma-citation="entities:516:1">HSBC Holdings Plc (5 HK)</a>'s new release for 1Q18 makes it less easy than normal to gauge credit quality. Under IFRS 9 there is new disclosure to match the new accounting. We must now focus on stage 1, stage 2 and stage 3 loans. The first two categories, are most like the old classifications, pass loans and special mention loans. These are not non-performing loans (NPLs). Stage 3 loans will now include most all NPLs. For HSBC there is also a worse category that is also part of NPLs: purchased bad…

HSBC Holdings Plc (5 HK)'s new release for 1Q18 makes it less easy than normal to gauge credit quality. Under IFRS 9 there is new disclosure to match the new accounting. We must now focus on stage 1, stage 2 and stage 3 loans. The first two categories, are most like the old classifications, pass loans and special mention loans. These are not non-performing loans (NPLs). Stage 3 loans will now include most all NPLs. For HSBC there is also a worse category that is also part of NPLs: purchased bad…

HSBC – Deciphering Credit Quality Under New IFRS 9 Accounting

United Kingdom

HSBC Holdings plc is the holding company for the HSBC Group. The Company provides a variety of international banking and financial services, including retail and corporate banking, trade, trusteeship, securities, custody, capital markets, treasury, private and investment banking, and insurance.  The Group operates worldwide.

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HSBC Holdings (5 HK)

Systemic Leverage Risk Has Returned In Full Force

*Out of Control Credit Risk: High yield credit risk is out of control at 5% of global GDP just as credit metrics at the top of the market are...

Thomas J. Monaco

Asian Banks – Margin Disparity Favors Asean

Generally, it is Asean banks where net interest margins (NIM) have seen the best change over the past two years. And for many, this continues in...

Daniel Tabbush

HSBC Holdings Plc – Full of Buffalo-Ney

* Unchallenged 1Q18 Result: The Group posted a weak 1Q18 result, to which no analysts really challenged.* No Subsidiary Discussion Was Had: HSBC NA...

Thomas J. Monaco

Money Matters: Chinese Financial System Opening Up- The Chance of a Lifetime?

A recent Bloomberg article titled "China's about to give global finance the chance of a lifetime" made me smile. In the article Bloomberg predicts...

Stewart Paterson

HSBC – Deciphering Credit Quality Under New IFRS 9 Accounting

HSBC Holdings Plc (5 HK)'s new release for 1Q18 makes it less easy than normal to gauge credit quality. Under IFRS 9 there is new disclosure to...

Daniel Tabbush

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