Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Victor Galliano is an experienced equity banks analyst, having covered Latin America banks and non-bank financials for over 12 years, as well as more recently covering the Italian banks. He has worked in sell side equity research for 30 years in a career spanning Barclays, HSBC, BBVA LatInvest, Barings and NatWest.
Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.
The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Financials & FinTech research

Banco Do Brasil (BBAS3 BZ): CEO Resignation, near Term Downside, but How Much Is Already Discounted?

Banco Do Brasil (BBAS3 BZ): Excessively Hard Hit by the Fear Factor

GEM Bank Credit Quality and Value Screens; the 4Q20 Story so Far

Brazil Banks YE2020 Snapshot II: Banco Do Brasil (BBAS3 BZ) Fair Credit Quality, Positive on Capital

Battle Lines Drawn As BABA Builds Out First/Last-Mile Capacity; But Who Will Fund 75+ Bn CNY CapEx?

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>The macro-economic and political backdrop for Brazil is a challenging one, which has driven the poor performance of Brazil assets and the BRL</li>
<li>Governance concerns re <a href="https://www.smartkarma.com/entities/banco-do-brasil-sa" target="_blank" data-smartkarma-citation="entities:24564:1" rel="noopener">Banco Do Brasil Sa (BBAS3 BZ)</a>, in the wake of the removal of the Petrobras CEO, have added to the negative share price impact, yet we see cause for optimism</li>
<li>Attractive absolute valuations, as well as relatively low PBV ratios, are discounting a lot of the bad news</li>
<li>Banco do Brasil’s balance sheet is much improved at YE 2020, in terms of capital adequacy as well as NPL coverage, and its exposure to higher risk loan segments is limited</li>
<li>The prospect of rising benchmark interest rates is already leading to better new loan pricing sector-wide and the potential of recovering credit spreads contributes to the bull case</li>
<li>Risks to our positive view on Banco do Brasil include the removal of its market oriented CEO, worse than expected credit delinquency going forward as well as a less than expected positive impact from rising spreads</li>
</ul>


The macro-economic and political backdrop for Brazil is a challenging one, which has driven the poor performance of Brazil assets and the BRL
Governance concerns re Banco Do Brasil Sa (BBAS3 BZ), in the wake of the removal of the Petrobras CEO, have added to the negative share price impact, yet we see cause for optimism
Attractive absolute valuations, as well as relatively low PBV ratios, are discounting a lot of the bad news
Banco do Brasil’s balance sheet is much improved at YE 2020, in terms of capital adequacy as well as NPL coverage, and its exposure to higher risk loan segments is limited
The prospect of rising benchmark interest rates is already leading to better new loan pricing sector-wide and the potential of recovering credit spreads contributes to the bull case
Risks to our positive view on Banco do Brasil include the removal of its market oriented CEO, worse than expected credit delinquency going forward as well as a less than expected positive impact from rising spreads


Brazil Banks - Market Concerns Overdone, with the Banco Do Brasil (BBAS3 BZ) Strengths Under-Rated