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)

It is still difficult to digest the optimism in some commentary regarding true underlying financial health. Adding to the regime of onerous banking regulations is an environment of economic and financial fear. The decline in U.S. 10 year bond yields this year alone is testimony to this. Negative interest rates in Japan, EU, and Sweden, suggests the growth outlook is terrible.Remember when the world was waiting for rising U.S. rates and normalization of higher rates globally? This was when the world’s overly liquid banks would start to print money; earning an immediately higher spread on their excess deposits. It is not happening. It is more like the opposite now.

It is still difficult to digest the optimism in some commentary regarding true underlying financial health. Adding to the regime of onerous banking regulations is an environment of economic and financial fear. The decline in U.S. 10 year bond yields this year alone is testimony to this. Negative interest rates in Japan, EU, and Sweden, suggests the growth outlook is terrible.Remember when the world was waiting for rising U.S. rates and normalization of higher rates globally? This was when the world’s overly liquid banks would start to print money; earning an immediately higher spread on their excess deposits. It is not happening. It is more like the opposite now.

Only three countries in Asia Pacific are seeing NPLs in decline during over the past three to four quarters. The average rate of growth is 20%, which is not overly worrisome, but nonetheless it remains substantial.Indonesia tops the charts due to less well-known banks, and many that are subsidiaries from banks outside the country. On average NPL formation for Indonesia’s listed banks is 87% but when including only the major domestic banks the figure is less dramatic at 31%.  At the very least,…

Only three countries in Asia Pacific are seeing NPLs in decline during over the past three to four quarters. The average rate of growth is 20%, which is not overly worrisome, but nonetheless it remains substantial.Indonesia tops the charts due to less well-known banks, and many that are subsidiaries from banks outside the country. On average NPL formation for Indonesia’s listed banks is 87% but when including only the major domestic banks the figure is less dramatic at 31%.  At the very least,…

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<ul>
<li>The local media have mentioned that nearly 200,000 people in Korea have invested in Terra (Luna) and TerraUSD.</li>
<li>The combined market caps of Luna and TerraUSD at their peaks were nearly $60 billion and nearly $57.4 billion has been wiped out in the past week.</li>
<li>Consequently, in the coming weeks there could be some domino effect of people in Korea that have borrowed money to invest in these risky cryptos selling other assets.</li>
</ul>


The local media have mentioned that nearly 200,000 people in Korea have invested in Terra (Luna) and TerraUSD.
The combined market caps of Luna and TerraUSD at their peaks were nearly $60 billion and nearly $57.4 billion has been wiped out in the past week.
Consequently, in the coming weeks there could be some domino effect of people in Korea that have borrowed money to invest in these risky cryptos selling other assets.


The Collapse of Luna - Big Negative Impact on 200k Investors In Korea

Equity Bottom-Up

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In this insight, we discuss the risk vs. reward of Kakao Bank shares after the sharp appreciation of its share price post IPO. Kakao Bank's share price has appreciated to 78,500 won, up 101% from the IPO price of 39,000 won. Kakao Bank's market cap has ballooned to 37.3 trillion won.
Kakao Bank has now become the 10th largest stock in KOSPI. Kakao Bank's market cap is now similar to the combined market caps of the two largest banking groups in Korea including <a href="https://www.smartkarma.com/entities/kb-financial-group-inc" target="_blank" data-smartkarma-citation="entities:718:1" rel="noopener">KB Financial (105560 KS)</a> and <a href="https://www.smartkarma.com/entities/shinhan-financial-group-ltd" target="_blank" data-smartkarma-citation="entities:6978:1" rel="noopener">Shinhan Financial (055550 KS)</a> - 42 trillion won. After this sharp appreciation, we believe that the risk-reward ratio of Kakao Bank is no longer attractive and change our view on the company to NEGATIVE.  
</div>


In this insight, we discuss the risk vs. reward of Kakao Bank shares after the sharp appreciation of its share price post IPO. Kakao Bank's share price has appreciated to 78,500 won, up 101% from the IPO price of 39,000 won. Kakao Bank's market cap has ballooned to 37.3 trillion won.
Kakao Bank has now become the 10th largest stock in KOSPI. Kakao Bank's market cap is now similar to the combined market caps of the two largest banking groups in Korea including KB Financial (105560 KS) and Shinhan Financial (055550 KS) - 42 trillion won. After this sharp appreciation, we believe that the risk-reward ratio of Kakao Bank is no longer attractive and change our view on the company to NEGATIVE.  


South Korea

Shinhan Financial Group Co., Ltd., a holding company, provides a full range of consumer and commercial banking-related financial services.  The company's main businesses include banking, securities brokerage, trust banking, and assets management to individuals, businesses, and other financial institutions.

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Shinhan Financial (055550 KS)

Asian Banks – Risks Remain Plentiful

It is still difficult to digest the optimism in some commentary regarding true underlying financial health. Adding to the regime of onerous banking...

Daniel Tabbush

A Gradual NPL Cycle in Asia

Only three countries in Asia Pacific are seeing NPLs in decline during over the past three to four quarters. The average rate of growth is 20%,...

Daniel Tabbush

The Collapse of Luna - Big Negative Impact on 200k Investors In Korea

The local media have mentioned that nearly 200,000 people in Korea have invested in Terra (Luna) and TerraUSD. Their combined values have collapsed...

Douglas Kim

Kakao Bank - Risk Vs. Reward Post IPO

After this sharp appreciation, we believe that the risk-reward ratio of Kakao Bank is no longer attractive and change our view on the company to...

Douglas Kim

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52-week Range

Market Cap (USDm)

P/E

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