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>De-Risking is well in place in weekly balance sheet for US banks. Cash rose USD122bn in past 2 weeks, loans rose USD31bn, and deposits rose USD113bn. CRE loans are down.</li>
<li>US banks' LDR <em>was</em> rising a lot, from 58.6% low in week of 15 December 2021 to 69.3% in the most recent week's data; they do not want the money.</li>
<li>The increase in large time deposits, which cost more than other deposits, is now 82.8% YoY in the most recent week; this YoY growth was 71.0% just 9 weeks earlier.</li>
</ul>


De-Risking is well in place in weekly balance sheet for US banks. Cash rose USD122bn in past 2 weeks, loans rose USD31bn, and deposits rose USD113bn. CRE loans are down.
US banks' LDR was rising a lot, from 58.6% low in week of 15 December 2021 to 69.3% in the most recent week's data; they do not want the money.
The increase in large time deposits, which cost more than other deposits, is now 82.8% YoY in the most recent week; this YoY growth was 71.0% just 9 weeks earlier.


US Banks - Added $122bn Cash In Past 2 Weeks | Loans up $31bn | CRE Loans Down | Deposits up $113bn

Equity Bottom-Up

<ul>
<li>Remitly (RELY) offers remittances services with 5m active customers, in over 170 countries, with 4 billion bank accounts, and 4,800 corridors, mostly to persons in US, Canada.  </li>
<li>Revenue growth is strong at 49% YoY in 2Q23 and averaging 43% YoY for the preceding 5 quarters, with active customers up 474,000 in 2Q23 QoQ vs 371,000 in 1Q23</li>
<li>Costs remain high, GAAP earnings are in loss, but this is due to stock-based compensation; adjusted EBITDA is now USD20.4m in 2Q23 from an adjusted EBITDA loss YoY</li>
</ul>


Remitly (RELY) offers remittances services with 5m active customers, in over 170 countries, with 4 billion bank accounts, and 4,800 corridors, mostly to persons in US, Canada.  
Revenue growth is strong at 49% YoY in 2Q23 and averaging 43% YoY for the preceding 5 quarters, with active customers up 474,000 in 2Q23 QoQ vs 371,000 in 1Q23
Costs remain high, GAAP earnings are in loss, but this is due to stock-based compensation; adjusted EBITDA is now USD20.4m in 2Q23 from an adjusted EBITDA loss YoY


Remitly - Rev +49% | ROW Rev +120% | Scaling: COGS -25% | Adj EBITDA Margin 2Q23 Is 8.7%, Highest

<ul>
<li>Large US banks show -0.2% growth YoY in CRE loans at 30 August week, completely at odds with small US banks, showing 11.3% YoY growth, more than total loan growth</li>
<li>Large time deposit at large banks are now up 80.1% YoY, accelerating, with only 1.95% YoY loan growth, negative implications for net interest income delta</li>
<li>Small banks have 1.44% LLR/loans vs large banks at 1.85%; small banks have capital/loans at 15.2% vs 22.2% for large banks; despite small banks' higher CRE lending</li>
</ul>


Large US banks show -0.2% growth YoY in CRE loans at 30 August week, completely at odds with small US banks, showing 11.3% YoY growth, more than total loan growth
Large time deposit at large banks are now up 80.1% YoY, accelerating, with only 1.95% YoY loan growth, negative implications for net interest income delta
Small banks have 1.44% LLR/loans vs large banks at 1.85%; small banks have capital/loans at 15.2% vs 22.2% for large banks; despite small banks' higher CRE lending


US Banks - New HFD | Big Bnks CRE -0.2%, Big FD's +80% | Sm. Bnks CRE +11% | LLR, Capital: Divergent

<ul>
<li>Weekly balance sheet data for US large banks shows another USD3bn decline in total loans</li>
<li>Large time deposits rose USD16bn in the week, YoY growth is accelerating, now 77.2% YoY</li>
<li>Risk aversion clearest with CRE loans, where growth is 0.41% YoY in most recent week</li>
</ul>


Weekly balance sheet data for US large banks shows another USD3bn decline in total loans
Large time deposits rose USD16bn in the week, YoY growth is accelerating, now 77.2% YoY
Risk aversion clearest with CRE loans, where growth is 0.41% YoY in most recent week


US Large Banks - Weekly B/S Update: $3bn Less Loans, $16bn More Jumbo Deposits, CRE Loans Nearly -Ve

<ul>
<li>Weekly data to 23 July in the US shows 30 year fixed mortgage rates hitting new highs at 7.23%</li>
<li>The past two weeks show mortgage rate increases accelerating, and up 45bps from 20 July data</li>
<li>Mortgage loan volume index is approaching 1990, weekly purchases index continues downward</li>
</ul>


Weekly data to 23 July in the US shows 30 year fixed mortgage rates hitting new highs at 7.23%
The past two weeks show mortgage rate increases accelerating, and up 45bps from 20 July data
Mortgage loan volume index is approaching 1990, weekly purchases index continues downward


US Banks - Weekly Data: Mortgage Loan Rates A New High, Loan Volume Index Approaches 1990 Further

United States

U.S. Bancorp is a diversified financial services company that provides lending and depository services, cash management, foreign exchange and trust and investment management services.  The Company also provides credit card services, mortgage banking, insurance, brokerage, and leasing.  U.S Bancorp operates in the Midwest and Western United States.

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US Bancorp (USB US)

US Banks - Added $122bn Cash In Past 2 Weeks | Loans up $31bn | CRE Loans Down | Deposits up $113bn

US banks are de-risking. Weekly balance sheet data shows almost all new deposits coming in moving into cash. Jumbo time deposits now far higher to...

Daniel Tabbush

Remitly - Rev +49% | ROW Rev +120% | Scaling: COGS -25% | Adj EBITDA Margin 2Q23 Is 8.7%, Highest

49% revenue growth 2Q23, COGS/revenue in decline. Adj EBITDA is positive, rising sharply in 2Q23 from 1Q23, 4Q22. Scale, penetration, reach, new...

Daniel Tabbush

US Banks - New HFD | Big Bnks CRE -0.2%, Big FD's +80% | Sm. Bnks CRE +11% | LLR, Capital: Divergent

New weekly balance sheets: large banks at -0.2% CRE loan growth, first time negative this year; small banks at 11% CRE loan growth. Large banks'...

Daniel Tabbush

US Large Banks - Weekly B/S Update: $3bn Less Loans, $16bn More Jumbo Deposits, CRE Loans Nearly -Ve

US large banks' new weekly balance sheet data shows USD3bn less loans, USD16bn more large time deposits, with CRE loan growth nearing negative...

Daniel Tabbush

US Banks - Weekly Data: Mortgage Loan Rates A New High, Loan Volume Index Approaches 1990 Further

New weekly data for US mortgage loan applications and mortgage loan rates, suggest major deterioration in home lending for US banks during 3Q23....

Daniel Tabbush

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