Corporate Credit Analyst

Alan Greene

Thematic (Sector/Industry)

Recently announced industrial output figures for June suggest that Korea may be able to trade its way towards higher growth rates. However, at the same time, on 30 June, the Korea Times carried a headline “Bedroom shock: Korea's sexless rate ranked world's second”. The sovereign rating of its neighbour Japan has seen steady pressure for the last five years driven in part by its demographic profile. Korea's demographic profile is likely to deteriorate more rapidly than Japan's and we should therefore expect a similar debt induced stall in growth. The banking system is under pressure and this could soon translate into pressure on Korea's credit ratings.

Recently announced industrial output figures for June suggest that Korea may be able to trade its way towards higher growth rates. However, at the same time, on 30 June, the Korea Times carried a headline “Bedroom shock: Korea's sexless rate ranked world's second”. The sovereign rating of its neighbour Japan has seen steady pressure for the last five years driven in part by its demographic profile. Korea's demographic profile is likely to deteriorate more rapidly than Japan's and we should therefore expect a similar debt induced stall in growth. The banking system is under pressure and this could soon translate into pressure on Korea's credit ratings.

Can "sexless" Korea Beat the Demographic Cliff and Maintain Its Credit Rating?

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.

There is nothing quite as impressive as a decade-long decline of NPL ratios. But there is something more in the Philippines that suggests this will continue. There are almost no corporates with interest coverage at less than 1x. While SE Asian banks tend to look best in Asia, and where Philippines looks good in comparison, corporate interest coverage is another area where it shines.We all know that credit/GDP is lower in Philippines than most Asian countries, at just 62%. But what matters for…

There is nothing quite as impressive as a decade-long decline of NPL ratios. But there is something more in the Philippines that suggests this will continue. There are almost no corporates with interest coverage at less than 1x. While SE Asian banks tend to look best in Asia, and where Philippines looks good in comparison, corporate interest coverage is another area where it shines.We all know that credit/GDP is lower in Philippines than most Asian countries, at just 62%. But what matters for…

Philippines Shine in Terms of Corporate Interest Coverage

Co-founder & Managing Director, Marketnomix 

Rajan Govil

Co-founder & Managing Director

Marketnomix 

Macroeconomics

Philippines imports came in stronger than expected rising 11.7% y-o-y in March compared to a 5.6% y-o-y decline in February. Exports data which had been released a few weeks ago had seen a decline of 15.1% y-o-y in March compared to a fall of 4.5% y-o-y in February. The trade balance in March recorded a wider deficit of USD 1.746bn compared to a deficit of USD 1.104bn in February.On a 3-month moving average basis, non-oil imports increased around 10.8% y-o-y compared to an increase of 11.4%…

Philippines imports came in stronger than expected rising 11.7% y-o-y in March compared to a 5.6% y-o-y decline in February. Exports data which had been released a few weeks ago had seen a decline of 15.1% y-o-y in March compared to a fall of 4.5% y-o-y in February. The trade balance in March recorded a wider deficit of USD 1.746bn compared to a deficit of USD 1.104bn in February.On a 3-month moving average basis, non-oil imports increased around 10.8% y-o-y compared to an increase of 11.4%…

Philippines: Strong Domestic Demand Reflected in Rising Imports Data

Frontier and emerging markets (Vietnam)

Dylan Waller

Nomadic Equity

The Philippines has been experiencing high levels of economic growth, which has been driven by the business process outsourcing industry. &nbsp;The business process outsourcing industry has&nbsp;been a strong catalyst for the development of the real estate industry in The Philippines. &nbsp;MegaWorld Corporation provides investors with diverse exposure to the real estate industry, has low valuation, and also has a strong track record of success in The Philippines.

The Philippines has been experiencing high levels of economic growth, which has been driven by the business process outsourcing industry. &nbsp;The business process outsourcing industry has&nbsp;been a strong catalyst for the development of the real estate industry in The Philippines. &nbsp;MegaWorld Corporation provides investors with diverse exposure to the real estate industry, has low valuation, and also has a strong track record of success in The Philippines.

MegaWorld Corporation: Access the Growth of Real Estate in The Philippines

<ul><li>Philippine banks are now taking over others in SE Asia in terms of credit growth&nbsp;as they become more comfortable with their own financials and the overall economy.</li><li>Indonesian Bank loan growth has stepped down dramatically over the past few years. This reflects cyclically less corporate demand combined with increased caution from the banks</li><li>Thai Banks now report the lowest growth. With GDP growing at 0.5% this is reflective of demand.</li></ul>

Philippine banks are now taking over others in SE Asia in terms of credit growth&nbsp;as they become more comfortable with their own financials and the overall economy.Indonesian Bank loan growth has stepped down dramatically over the past few years. This reflects cyclically less corporate demand combined with increased caution from the banksThai Banks now report the lowest growth. With GDP growing at 0.5% this is reflective of demand.

South East Asian Loan Growth  - Phillippine, Thai and Indonesian Banks Compared.

Philippines

China Banking Corporation is a commercial bank. The Bank provides products and services such as deposit products, loans and trade finance, treasury products, trust products, corporate finance and other investment banking services.

Philtrust Bank provides various commercial banking products and services in the Philippines. The company offers checking accounts, savings accounts, time deposits, money market placements, business loans, transfer of funds and collections, remittances, securities investments, and safety deposit boxes. It also provides commercial letters of credit, collections and remittances, foreign exchange services, traveler�s checks, and foreign currency deposit unit transactions. In addition, the company offers trust services, such as trust placement, investment management, estate administration/trustee of bond issues, savings and pension plan administration, and insurance trust services, as well as acts as escrow agent, and stock registrar and transfer agent. It operates a network of approximately 57 branches and 57 automated teller machines. The company was founded in 1916 and is headquartered in Manila, the Philippines.

Rizal Commercial Banking Corporation provides banking and financial products and services in the Philippines and internationally. It operates through Retail Banking, Corporate Banking, Treasury, and Others segments. The company�s deposit products include checking and savings accounts, time deposits, foreign currency deposits, and cash cards. Its loan portfolio comprises commercial and consumer loans; and wholesale lending, rediscounting, and guaranty facilities. The company also provides remittance, payment and settlement, treasury, trust, overdraft facilities, money market, and trading services. In addition, it offers corporate cash management services, such as collection and receivables services; disbursements; government payment services; and third party services comprising collection and receivables services, and payment management services. Further, the company provides investment banking services, such as the underwriting of debt and equity securities for distribution through public offering or private placement; syndicated loans, joint ventures, and project finance; financial advisory and consultancy services; and mergers and acquisitions services. Additionally, it offers ancillary services, including day and night depository, deposit pick-up and delivery, foreign currency conversions, foreign trade information, economic and investment research, wealth management, and safety deposit boxes; automated teller machines; bills payment machines; and mobile, Internet, phone banking, and e-Shop services. As of December 31, 2014, the company operated a network of 449 business centers, including 35 extension offices; and 1,202 ATMs. The company was formerly known as Rizal Development Bank and changed its name to Rizal Commercial Banking Corporation in January 1963. Rizal Commercial Banking Corporation was founded in 1960 and is headquartered in Makati City, the Philippines. Rizal Commercial Banking Corporation operates as a subsidiary of Yuchengco Group of Companies.

Security Bank Corporation offers a wide variety of financial products and services. The Bank's services include peso, dollar and third currency deposits, domestic and international fund transfers, deposit pick-up and payroll services, and ancillary services.  Security Bank also provides working capital financing, term arrangements, loan syndication services.

Philippine National Bank, through its subsidiaries, provides commercial bank services. Its products include deposit-taking, lending, bill discounting, foreign exchange dealing, investment banking, and fund transfer. The Company also offers merchant banking, remittance servicing, non-life insurance, leasing, stock brokerage, foreign exchange trading, and related services.

Asia United Bank Corporation, together with its subsidiaries, provides a range of banking and other financial products and services to consumers, small medium enterprises, and large corporations in the Philippines. The company operates through Commercial, Consumer, Treasury, Branch Banking, and Others segments. It provides commercial banking services, such as deposit products, loans and trade finance, domestic and foreign fund transfers, treasury, foreign exchange, and trust services. Its deposit products include savings, current, time, and other currency deposit accounts; and loan portfolio comprises auto, home, salary, and commercial loans, as well as real estate and pension loans. The company also provides cash management services; investment products, including treasury and trust products; and other services consisting of card, remittance, property sale, and leasing services. As of June 30, 2016, the company operated 232 branches. Asia United Bank Corporation was founded in 1997 and is headquartered in Pasig, the Philippines.

East West Banking Corporation, together with its subsidiaries, operates as a commercial bank providing a range of financial services to consumer and corporate clients in the Philippines. It operates through Retail Banking, Corporate Banking, Consumer Banking, and Treasury and Trust segments. The company offers personal banking services, such as checking and savings accounts, time deposit, bills payment, check-writing, and prepaid and gift cards; credit cards; auto, home, pre owned properties and cars, personal, and business loans; Internet banking; personal investment services, including money market and fixed-income unit investment trust funds, and fixed-income investment trust funds; and suite of corporate services comprising payroll, disbursement, collection, and others services. It also provides trade finance; treasury products, such as fixed income securities and foreign exchange products; and fund and investment management, custodianship, administration and collateral agency services, and stock and transfer agency services. As of As of December 31, 2014, it served its customers through a network of 358 branches and 533 ATMs. The company was founded in 1994 and is headquartered in Taguig City, the Philippines.

Philippine Business Bank, Inc., a savings bank, provides various banking and financial services in the Philippines. It operates through Consumer Banking, Corporate Banking, and Treasury Operations segments. The company offers deposits and investment services, including savings and checking accounts, automatic transfer accounts, payroll accounts, CASA, campus savers, time deposits, hi-green funds, Hi-5 TDs, and FCDU savings and time deposits. It also provides commercial, industrial, and developmental loans comprising bills purchase, term loans, omnibus line, discounting line, trade finance, agricultural loans, bus loans, and floor stock/inventory financing products, as well as specialized lending facilities for small and medium enterprises. In addition, the company offers consumer loans consisting of auto loans, salary loans, housing loans, and personal loans. Further, it provides trust products and services, including diamond funds; living trusts; employee benefit plans under trust; trustee of pre-need plans; escrow agency; mortgage trusts; investment management arrangements for both individual and commercial clients; security, safekeeping, and depository arrangements; and funds management of employee benefit and pre-need plans. Additionally, the company offers cash management services, remittance services, local payment orders, foreign drafts, safety deposit box facilities, night depository boxes, group payroll services, bills payment/collection services, and SSSPayments/PhilHealth products. As of February 5, 2015, it had approximately 116 branches in the Philippines. Philippine Business Bank, Inc. was founded in 1997 and is headquartered in Caloocan, the Philippines.

Philippine Bank of Communications provides commercial banking products and services in the Philippines. The company operates through Branch Banking Group, Corporate Banking Group, Treasury, Consumer Finance, and Trust and Wealth Management segments. It offers deposit products and services, including savings, checking, and time deposit accounts; and loans comprising commercial loans, industrial loans, foreign currency loans, rediscounting loans, specialized lending programs, export packing credit loans, trust receipt financing, consumer lending, and guarantee programs, as well as auto, home, personal, and SME loans. The company also provides investment and wealth management products, such as trust products; treasury products; and other services, including safe deposit boxes, manager's checks, and gift checks. In addition, it offers cash management solutions, such as check writing and check warehousing facilities, deposit pick-up services, payroll services, SSS Net, tax link or BIR electronic filing and payment systems, Bancnet bills payment, and other payment and collection services; and staff provident fund and retirement/pension fund services. Further, the company provides trade-related services, such as commercial letters of credit, stand-by letters of credit, bank guaranty, trust receipts, export packing credit/export bills purchase, clean and documentary collections, import bills/customer�s liabilities under acceptances, and trade receivables and payables financing. It offers its products and services through 82 branches and 11 other banking offices. Philippine Bank of Communications was incorporated in 1939 and is based in Makati, the Philippines.

Metropolitan Bank & Trust Company offers commercial and investment banking services. The Bank's business activities include borrowing and lending, trade finance, remittances, treasury, investment banking and savings.

Trustmark Corporation is the holding company for Trustmark National Bank. The Bank offers a variety of banking, investment, and insurance solutions to corporate, institutional, and individual customers in Mississippi and Tennessee.

Tisco Financial Group Pcl is a bank holding company.  The Company's banking subsidiary offers working capital, project, term, automobile and home loans; custodian services; securities brokerage; mutual funds; and private banking; and advises on equity and debt capital markets, privatizations, debt restructuring, project finance, and mergers and acquisitions.

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

Saigon Thuong Tin Commercial Joint-Stock Bank, known as Sacombank, operates various personal and corporate banking services such as deposits, foreign exchange transactions, loans, outward transfer, and international payments.

Bank of Chongqing Co. Ltd. provides commercial banking services. The Company offers financial services to individuals and enterprises including deposits, loans, settlement, currency trading, financial & government bonds, and credit cards services. Bank of Chongqing also offers international services.

PT Bank Panin Indonesia Tbk provides commercial banking and foreign exchange services in Indonesia and overseas.

PT Bank Permata Tbk provides commercial and foreign exchange banking services through a network of offices in Indonesia.  The Bank also performs custodianship and trusteeship services as well as manages pension funds.

Customers Bancorp, Inc. provides banking services. The Company offers checking and saving accounts, personal and commercial loans, and retirement planning services. Customers Bancorp serves customers throughout the State of Pennsylvania.

Triumph Financial Inc. offers traditional banking products as well as commercial finance products to businesses that require specialized and tailored financial solutions.

Seacoast Banking Corporation of Florida operates as a bank holding company. The Bank, through its subsidiaries, offers a full range of banking and investment services, including personal and business deposit products, personal, commercial, and mortgage loans, wealth management services, and treasury management solutions.

UnionBank of the Philippines, together with its subsidiaries, provides various commercial banking products and services in the Philippines. It operates through Consumer Banking, Corporate and Commercial Banking, and Treasury segments. The company offers various personal banking products and services, such as savings and checking accounts, and time deposits; auto loans; debit and credit cards; trust and investment products; remittance products and services; and mobile banking services, as well as foreclosed properties and vehicles. It also provides corporate and small and medium scale enterprise products and services that consist of cash management services; various small business products and services; and treasury products. In addition, the company offers corporate and commercial banking loans; salary and mortgage loans; consumer finance products; pre-need insurance products and services; funds transfer facilities; retail and trust banking products and services; and capital markets products, as well as handles transactions in the financial markets covering foreign exchange and fixed income trading, and investments and derivatives products. Further, it provides insurance, securities, and foreign currency brokerage services; data processing services; venture capital products; financial products marketing services; and real estate administration services, as well as acts as a thrift banker. The company serves retail, middle market, corporate, and institutional customers, as well as small and medium enterprises and government institutions. As of December 31, 2014, it had 253 branches; and 243 on-site and 39 off-site automated teller machines. The company was formerly known as Union Savings and Mortgage Bank and changed its name to UnionBank of the Philippines in January 1982. UnionBank of the Philippines was founded in 1968 and is based in Pasig City, the Philippines.

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UnionBank of the Philippines (UBP PM)

Can "sexless" Korea Beat the Demographic Cliff and Maintain Its Credit Rating?

Recently announced industrial output figures for June suggest that Korea may be able to trade its way towards higher growth rates. However, at the...

Alan Greene

Philippines Shine in Terms of Corporate Interest Coverage

There is nothing quite as impressive as a decade-long decline of NPL ratios. But there is something more in the Philippines that suggests this will...

Daniel Tabbush

Philippines: Strong Domestic Demand Reflected in Rising Imports Data

Philippines imports came in stronger than expected rising 11.7% y-o-y in March compared to a 5.6% y-o-y decline in February. Exports data which had...

Rajan Govil

MegaWorld Corporation: Access the Growth of Real Estate in The Philippines

The Philippines has been experiencing high levels of economic growth, which has been driven by the business process outsourcing industry. The...

Nomadic Equity

South East Asian Loan Growth - Phillippine, Thai and Indonesian Banks Compared.

Philippine banks are now taking over others in SE Asia in terms of credit growth as they become more comfortable with their own financials and the...

Daniel Tabbush

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