Daily Brief Financials: Suruga Bank Ltd, Nexus Select Trust, HSBC Holdings, AUB Group Limited, Binance Coin, BlackRock Latin American Inves, AGBA Group Holding and more

• Suruga Bank Ltd (8358 JP) today signed an MOU (with board resolution) to form a business and capital alliance with Credit Saison (8253 JP). 
• Suruga will sell (post-dilution) 15+% of voting rights to Credit Saison, and buy 4.44% of CreditSaison. Then Suruga will try to buy back the shares it sold to Credit Saison.
• A look at the history is instructive, as is a look at the shareholder structure and the change in business model post-2019. Not as easy as it looks. 

• Nexus Select Trust (NST IN) raised around US$391m in its India IPO. The market value of its assets stood at INR234bn (US$2.9bn), of which INR211bn (US$2.6bn) was from its retail assets.
• NST is a REIT with a portfolio of 17 Grade A urban consumption centers. It is backed by Blackstone.
• We have looked at various aspects of the deal in our previous note, in this note, we talk about the demand and trading dynamics.

• After a multi-year drop in ownership, UK fund exposure in HSBC Holdings is on the rise. 
• Over the last 6-months, average fund weights have increased by +0.33% as new positions outnumbered closing positions by a factor of 2.
• With increasing active fund ownership and rising benchmark weights, UK Equity funds need higher conviction to omit HSBC from their portfolio.

• AUB Group Limited (AUB AU) is looking to raise up to AUD150m (US$100m) in its primary placement. The proceeds will be used to strengthen its balance sheet.
• The deal would be a large one to digest at 24 days of three month ADV and dilution of 6.2%.  
• In this note, we’ll run the deal through our ECM framework and comment on deal dynamics.

• The stablecoin market has been upended in 2023.
• The start of the year saw BUSD given an expiry date of 2024, a banking crisis in March hit USDC and DAI hard, while Binance anointed TUSD as its stablecoin of choice by choosing it for one of the few zero-fee BTC pairs in crypto.
• All of these events had huge ramifications for stablecoin market structure.

BlackRock Latin American Investment Trust’s (BRLA’s) lead manager Sam Vecht and deputy manager Christoph Brinkmann have a high degree of confidence in the positive prospects for the trust’s portfolio. It has an overweight exposure to Brazil versus its benchmark, the MSCI Emerging Markets Latin America Index. Vecht highlights high real interest rates in the country, providing scope for a lower base rate. Brazil now has a more stable political situation, and the manager anticipates that the economy should turn around in H223, which he believes would be positive for equity performance. Vecht and Brinkmann consider that BRLA’s portfolio has real potential to deliver better absolute and relative performance.

AGBA is a Hong Kong-based financial services company offering a wide range of financial and healthcare products to the Guangdong-Hong Kong-Macao Greater Bay Area (GBA). With a population of 86 million, the GBA is a dynamic US$2tn economy, representing 13% of China’s GDP. Coupled with an ageing population, expansion into the GBA serves as a strategic move to meet the ever-increasing demand for health and wealth products. Through its extensive distribution network of 1,528 independent financial advisors (the largest in Hong Kong), AGBA is well placed to benefit from a recovery in sales following the recent removal of COVID-19 restrictions.