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

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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>The risks are obvious even if it’s housing lending. Debt/equity is 996% for <a href="https://www.smartkarma.com/entities/lic-housing-finance-ltd" target="_blank" data-smartkarma-citation="entities:15667:1" rel="noopener">LIC Housing Finance (LICHF IN)</a>, higher than any other NBFC in India as at 2Q20. Funding risk is high and we know from the downfall at IL&amp;FS that this can be more important than credit risk. But for LIC, credit risk is also a major concern.  Credit costs as a percentage of operating profit rose from 9.4% to 24.0%, from FY19 to 2Q20 at LIC. There are few NBFCs seeing this magnitude of growth in impairment costs.  It’s only likely to worsen in 3Q20 and in coming quarters.  New GDP forecasts just out by the Modi government are the lowest in 11 years. The shock in oil prices will not help and where sharp interest rate reductions are nearly impossible, given the currency - besides the fact that banks are have not been passing on lower RBI rates.  The reality is that we are well past the much-touted bank recapitalization plan, reshaping of new NPL laws and the elections, but the banking and economic situation only worsens.  </p>

The risks are obvious even if it’s housing lending. Debt/equity is 996% for LIC Housing Finance (LICHF IN), higher than any other NBFC in India as at 2Q20. Funding risk is high and we know from the downfall at IL&amp;FS that this can be more important than credit risk. But for LIC, credit risk is also a major concern.  Credit costs as a percentage of operating profit rose from 9.4% to 24.0%, from FY19 to 2Q20 at LIC. There are few NBFCs seeing this magnitude of growth in impairment costs.  It’s only likely to worsen in 3Q20 and in coming quarters.  New GDP forecasts just out by the Modi government are the lowest in 11 years. The shock in oil prices will not help and where sharp interest rate reductions are nearly impossible, given the currency - besides the fact that banks are have not been passing on lower RBI rates.  The reality is that we are well past the much-touted bank recapitalization plan, reshaping of new NPL laws and the elections, but the banking and economic situation only worsens.  

LIC Housing – Dizzying Gearing, Soaring Bad Loans