Research and consultancy, Tabbush Report

Daniel Tabbush

The Tabbush Report: Asian bank research and consultancy, without the noise.

Daniel Tabbush has ~30 years experience analyzing Asia-Pacific banks, including HSBC, Standard Chartered, Japanese and Australian banks. His research and consulting focuses on global banking issues, including with banks in the US. He was the Head of Asian Bank research at the number one Asian brokerage CLSA for most of his career, overseeing coverage of 80 banks and 10 analysts in Asia-Pacific.

He has been highly ranked by Asiamoney, The Asset and Bloomberg, as well as by institutional investors focused on Asia. He continues to appear in press interviews with TVB in Hong Kong, and has appeared on CNBC in the past. He maintains an information-sharing agreement with Dr. Jim Walker of Asianomics, the foremost economist in Asia-Pacific, and Tabbush was an invited speaker on Asian banks at the Independent Research Summit in Hong Kong, during years 2013 and 2014.

Daniel started his own independent bank research and consultancy in 2012, under the banner name Tabbush Report. Since 2014, he has been a member of University of California San Diego Economics Leadership Council (ELC), supporting Economic students at the University through this alumni association, and providing guidance on Economics program develoment. Daniel grew up in Los Angeles, graduated from UCSD in Economics, cum laude and with Phi Beta Kappa honors. He lives with his family in Bangkok, and enjoys cooking, running and chess.

He is known for extolling the unusual positives of Japan’s mega banks in 2005, and the risks likely to hit HSBC from its U.S. subprime loan operations, in 2006.  More recently, when most were concerned with nearly all Western banks in late 2008, Tabbush highlighted the positive outlook for Standard Chartered Bank at that time. 

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, S&P Global Market Intelligence. S&P Capital IQ augments our database, with corporate data and CEIC, with economics.

Research and consultancy

The Week that Was in ASEAN@Smartkarma - Vietnam's Savings, Double Dragon, and Singapore Gaming

The Week that Was in ASEAN@Smartkarma - Thai Politics, Bank Negara Indonesia, and Singapore Property

Global Banks – DBS Frail Against Global Peers

DBS Bank – The Murky Detail of New 2Q18 Data that Is Easy to Miss, and Not as Positive as Headlines

DBS 1Q18 – Strength in Revenue, but Credit Metrics Are Worse than Headlines

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.

Equity Bottom-Up

<p>While <a href="https://www.smartkarma.com/entities/22" target="_blank" data-smartkarma-citation="entities:22:1">DBS Group Holdings (DBS SP)</a> reported good net interest income and trading gains, we do not view the whole of its figures as robust. Core fee and commission income is hardly up while operating costs are rising substantially. But to us what matters most is how the bank’s profit is essentially driven by sharply lower credit costs. Its credit costs fell S$88m while its net profit rose S$120m YoY in 1Q19. Despite this, the bank’s bad loans are not sharply lower, and it shifted meaningfully from retained earnings to allowance for loan losses; this raises NPL cover but does nothing to affect profit. With pedestrian, but positive growth in credit costs in the income statement, net profit growth would be closer to 2% YoY. Historically, when credit costs have been this low for DBS (at just 5bps of assets in 1Q19), it is typically followed by much higher figures, and given global economies, this may be more sensible now than in the past. </p>

While DBS Group Holdings (DBS SP) reported good net interest income and trading gains, we do not view the whole of its figures as robust. Core fee and commission income is hardly up while operating costs are rising substantially. But to us what matters most is how the bank’s profit is essentially driven by sharply lower credit costs. Its credit costs fell S$88m while its net profit rose S$120m YoY in 1Q19. Despite this, the bank’s bad loans are not sharply lower, and it shifted meaningfully from retained earnings to allowance for loan losses; this raises NPL cover but does nothing to affect profit. With pedestrian, but positive growth in credit costs in the income statement, net profit growth would be closer to 2% YoY. Historically, when credit costs have been this low for DBS (at just 5bps of assets in 1Q19), it is typically followed by much higher figures, and given global economies, this may be more sensible now than in the past. 

DBS – Most Profit Growth Is Less Credit Costs