In today’s briefing:
- StandChart Is Likely to Have More China Bohai Impairment
- South Korean Banks; Woori Financial (316140 KS) Added to Buy List, Joining KB Financial (105560 KS)
- Crypto Moves #16 – Why We Are Long Ethereum Layer 2s
- Moody’s Corporation: New GenAI Tool
StandChart Is Likely to Have More China Bohai Impairment
- StandChart may need to take further impairment hit on China Bohai Bank
- VIU model is used to justify the higher carrying value compared to fair value of the holdings. There is zero headroom between the VIU model and the carrying amount.
- We looked at VIU model assumptions for HSBC and StandChart. A declining NIM is likely put further pressure on the VIU model output for StandChart.
South Korean Banks; Woori Financial (316140 KS) Added to Buy List, Joining KB Financial (105560 KS)
- In our latest South Korean banks screener; we add Woori Financial to existing buy KB Financial as our preferred Korean banks picks
- Delinquency ratios continued to worsen QoQ, with only Woori bucking the 4Q23 NPL trend; Woori has lagged in terms of returns, but we expect CoR control to support 2024 returns
- KB has a low PBV ratio relative to its ROE, it delivers rising post-provision returns, it has a high CET1 ratio and it maintains a healthy LDR
Crypto Moves #16 – Why We Are Long Ethereum Layer 2s
- In the short to medium term, Ethereum is mainly depending on what is known as off-chain scaling to significantly expand its blockchain’s capacity beyond its current limit of roughly 15 transactions per second.
- This strategy sets Ethereum apart from other blockchains like Solana, which primarily concentrate on scaling directly on the blockchain itself, also known as on-chain scaling.
- Ethereum’s method involves using something called Layer 2s, or rollups.
Moody’s Corporation: New GenAI Tool
- Moody’s Corporation showed a promising performance in their fourth quarter and full-year results of 2023.
- The company ended the year with an 8% revenue growth and an increase in adjusted diluted EPS by 16%.
- Within these achievements, Moody’s has been highlighted as an early adopter and innovator of GenAI. A significant accomplishment was the launch of their first-ever GenAI-enabled product in December 2023.
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