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>Comments today from BOJ suggest we are nearing the end of negative interest rates in Japan, which can mean an immediate boost to net interest income for Japan's banks</li>
<li>Many banks have cash and deposits with the BOJ at high levels, where yields are negative, and this can be the first big positive delta to bank's income</li>
<li>Credit metrics in Japan are improving and loan growth is accelerating, this is generally at odds with other major banking systems, US, UK, Singapore</li>
</ul>


Comments today from BOJ suggest we are nearing the end of negative interest rates in Japan, which can mean an immediate boost to net interest income for Japan's banks
Many banks have cash and deposits with the BOJ at high levels, where yields are negative, and this can be the first big positive delta to bank's income
Credit metrics in Japan are improving and loan growth is accelerating, this is generally at odds with other major banking systems, US, UK, Singapore


Japan Banks - Near End of Negative Rates BOJ, Deposits with BOJ to See Big Yield Rise, Not Only JGBs

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>2023 marked our eighth year covering Equity Capital Markets in Asia Pacific. In 2023, IPOs didn’t pick up much from the low base of 2022  while placements showed upward momentum.</li>
<li>We ended 2023 with an accuracy rate of 73.7% across 57 IPOs that we covered and 79.3% across 115 placements.</li>
<li>For those not familiar with our coverage, we aim to cover all IPOs and placements with a minimum deal size of US$100m across Asia-Pacific, including China ADRs.</li>
</ul>


2023 marked our eighth year covering Equity Capital Markets in Asia Pacific. In 2023, IPOs didn’t pick up much from the low base of 2022  while placements showed upward momentum.
We ended 2023 with an accuracy rate of 73.7% across 57 IPOs that we covered and 79.3% across 115 placements.
For those not familiar with our coverage, we aim to cover all IPOs and placements with a minimum deal size of US$100m across Asia-Pacific, including China ADRs.


Aequitas 2023 IPOs and Placements Performance Review - IPOs Forming a Low Base, Placements Pick Up

Event-Driven

<ul>
<li>As per Reuters, <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a> could look to sell up to 10% of <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a> to raise around US$4.7bn before the end of the year.</li>
<li>Toyota is the company’s largest shareholder and its largest customer.</li>
<li>In this note, we will talk about the deal dynamics.</li>
</ul>


As per Reuters, Toyota Motor (7203 JP) could look to sell up to 10% of Denso Corp (6902 JP) to raise around US$4.7bn before the end of the year.
Toyota is the company’s largest shareholder and its largest customer.
In this note, we will talk about the deal dynamics.


Denso Corp Placement - Possible Placement by Toyota to Raise US$4.7bn

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>I wrote <a href="https://www.smartkarma.com/insights/japan-h1-bank-earnings-interest-fees-up-expenses-credit-costs-down-opportunity-abounds-still" target="_blank" data-smartkarma-citation="insights:116534" rel="noopener">Japan H1 Bank Earnings: Interest/Fees Up, Expenses/Credit Costs Down - Opportunity Abounds, Still</a> last week mentioning the trends in guidance revisions.</li>
<li>Since then, five have reported H1. +20%, +53%, +23% vs guidance; +25.6%, and +28.2% vs Last Year. Eight more have added new guidance, weighted average H1 up 48%. </li>
<li>Four more report tomorrow, eight on Thurs, 43 on Friday. The Top 5 are all next Mon/Tues. Watch for comments about portfolio restructuring efforts in H2 as market yields rise.</li>
</ul>


I wrote Japan H1 Bank Earnings: Interest/Fees Up, Expenses/Credit Costs Down - Opportunity Abounds, Still last week mentioning the trends in guidance revisions.
Since then, five have reported H1. +20%, +53%, +23% vs guidance; +25.6%, and +28.2% vs Last Year. Eight more have added new guidance, weighted average H1 up 48%. 
Four more report tomorrow, eight on Thurs, 43 on Friday. The Top 5 are all next Mon/Tues. Watch for comments about portfolio restructuring efforts in H2 as market yields rise.


Japan H1 Bank Earnings: Last Minute Update; Suruga Bank Reacts Well

<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

Japan

The Gunma Bank, Ltd. is a regional bank based in Gunma Prefecture.  The Bank provides banking services such as deposits, loans, and foreign exchange transaction.  The Gunma Bank also provides financial services such as leasing, credit cards, letter of credit, and investment advisory, and develops information systems.

Yamaguchi Financial Group, Inc. is a holding company established through the merger of Yamaguchi Bank and Momiji Holdings. The Group provides variety of financial services such as deposits, loans, foreign exchange transactions, leasing and credit cards.

The Hachijuni Bank, Ltd. is a regional bank based in Nagano Prefecture. The Bank provides banking services such as deposits, loans, foreign exchange transactions, and trust accounts. The Bank also provides financial services such as leasing, credit cards, credit guarantee, debt recovery, trading, and venture capital and operates branches overseas.

Kyushu Financial Group, Inc. is a holding company established through the merger of Higo Bank and Kagoshima Bank.  The Bank provides banking services such as deposits, loans, and exchange transactions.  Kyushu Financial Group also provides other financial services including security brokerage, credit cards, leasing, and letters of credit.

Aozora Bank, Ltd. provides banking services including deposits, savings, loans, foreign exchange transactions, and securities investments. Aozora Bank also provides services such as trust account, resolution and collection, and venture capital.

The 77 Bank, Ltd. is a regional bank in Tohoku area.  The Bank provides general banking services including deposits, loans, and exchange transactions. The Bank also provides others financial services such as securities brokerage, trust banking, letter of credit, leasing, credit cards, and computer services.

Seven Bank, Ltd. provides banking services mainly through Automated Teller Machine (ATM) across Japan. The bank cooperates with affiliated financial institutions to establish the nationwide ATM network and provide remote banking services, including deposits and loans.

Rakuten Bank, Ltd. operates as an Internet based bank. The Company provides banking services including deposits, loans, exchange transactions, and other services. Rakuten Bank also provides financial services including investment trusts, securities, credit and cash cards, lottery tickets, and others.

Mebuki Financial Group Inc. is a holding company established through the merger of Joyo Bank and Ashikaga Bank. As a financial group, the Company offers deposits, Loans, foreign exchange transactions, commercial and trust banking. Mebuki Financial Group also provides financial services such as letter of credit, credit cards and consulting.

SBI Shinsei Bank, Ltd. provides banking services including deposits, loans, and foreign exchange transaction, as well as investment trust service and issuance of long-term bonds.

AMMB Holdings Berhad is an investment holding company.  The Company, through its subsidiaries, provides merchant and commercial banking, retail financing, stock and futures broking, and investment advisory. AMMB also underwrites general insurance, provides asset and unit trust management, and nominees services.

Bank of Hawaii Corporation is a regional financial services holding company with locations throughout the Pacific. The Company and its subsidiaries offers a wide range of financial services to businesses, governments, and individuals in Hawaii, the West Pacific, and American Samoa. Bank of Hawaii provides services such as commercial banking, investment and trust services, and mortgages.

Park National Corporation is a multi-bank holding company.  The Banks provide a variety of financial services, including savings and time accounts, consumer and real estate lending, safe deposit operations, and electronic funds transfers. Park National operates in Ohio.

Community Bank System, Inc. is a holding company for Community Bank, N.A.  The Bank offers a range of commercial and retail banking services in each of its market areas to business, individual, agricultural, and governmental customers. Community Bank operates in northern New York to the southern tier, west to Lake Erie, and in northeastern Pennsylvania.

CVB Financial Corp. is the holding company for Citizens Business Bank and Community Trust Deed Services.  The Bank attracts deposits and originates loans, as well as serves as a federal tax depository for its business customers. Citizens operates in Southern California.

Cathay General Bancorp is the holding company for Cathay Bank.  The Bank accepts deposits and originates various loans, and offers trade financing, spot and forward contracts, internet banking, global investment services, and other services.  Cathay Bank operates in California, New York, Texas, Washington, and Massachusetts.

PT Bank CIMB Niaga Tbk operates in individual and private banking, merchant and corporate banking, regional banking, and investment services.  The Bank also provides financial services such as leasing and factoring, stock broking, underwriting, insurance and investment management through its subsidiaries.

Simmons First National Corporation is a multibank holding company.  The Banks offer various loans, credit card services, checking and savings accounts, personal and corporate trust services, and other products and services through offices located in Arkansas.

Taichung Commercial Bank conducts commercial banking and trust business.  The Bank accepts deposits, offers loans, as well as  invests in bonds and stocks. Taichung Commercial Banks provides bills and notes discounting, draft endorsement, domestic remittance, guarantee, and securities underwriting and brokerage services.

Independent Bank Corp. is the holding company for Rockland Trust Company. The Bank attracts deposits and offers a range of financial services through a network of offices in Plymouth, Norfolk, Barnstable, and Bristol counties, Massachusetts.

SBI Sumishin Net Bank, Ltd. offers general banking services. The Company provides transfer accounts, deposits, currency savings, mortgages, net loans, investment trusts, insurance products, and other banking services. SBI Sumishin Net Bank offers services to individuals and businesses.

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SBI Sumishin Net Bank (7163 JP)

Japan Banks - Near End of Negative Rates BOJ, Deposits with BOJ to See Big Yield Rise, Not Only JGBs

The Bank of Japan has ended its negative interest rate policy. Some banks have just raised deposit rates, and loan rates, before that.

Daniel Tabbush

Aequitas 2023 IPOs and Placements Performance Review - IPOs Forming a Low Base, Placements Pick Up

2023 was our eight year of covering Asia ECM. We ended 2023 with an accuracy rate of 73.7% across 57 IPOs that we covered and 79.3% across 115...

Sumeet Singh

Denso Corp Placement - Possible Placement by Toyota to Raise US$4.7bn

As per Reuters, Toyota Motor (7203 JP) could look to sell up to 10% of Denso Corp (6902 JP) to raise around US$4.7bn before the end of the year.

Sumeet Singh

Japan H1 Bank Earnings: Last Minute Update; Suruga Bank Reacts Well

Since last week's piece, 5 banks have reported strong H1 results, ahead of guidance and up yoy. 7 more have amended H1 guidance up an average of...

Travis Lundy

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

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