Senior Bank Analyst - Japanese Banks, Windamee Research

J. Brian Waterhouse

J. Brian Waterhouse has been covering the Japanese financial sector as an analyst continuously since 1976, working for CLSA, Japaninvest, Rabobank, HSBC Securities, James Capel, Marine Midland Bank of New York and National & Grindlays Bank.  He has been ranked No.1 overall in Japanese banks research in Japan by Asiamoney for 6 of the past 9 years and was runner-up in 2015.  He was awarded the coveted Starmine prize as top Japanese bank stock picker in 2012 and 2014 and was runner-up in 2013.  He frequently appears on TV, radio and in international print media as a commentator on Japanese banking.

Senior Bank Analyst - Japanese Banks

Japanese Banks:  These Lifeless Things (The Ozymandias Syndrome)

Japanese Banks:  Beyond the Ides of March

TSE's Market Structure Review: Public Comments As Expected, But Miss The Mark

Big Trouble in Little Stocks? Maybe TSE Mulls Changing TOPIX

Windamee Research

Japanese Banks

Equity Bottom-Up

The stock price of <a href="https://www.smartkarma.com/entities/20254" target="_blank" data-smartkarma-citation="entities:20254:1">Senshu Ikeda Holdings (8714 JP)</a> , a medium-sized bank holding company based in Osaka, fell just over 15% today, a day after announcing FY3/2019 results that beat guidance but nevertheless represented a 27% YoY decline.  What irked investors, however, was not the underwhelming results per se but management’s decision to ‘take away the punchbowl from the partygoers’ by halving the dividend for FY3/2020 to just ¥7.5/share.  Investors have clearly enjoyed the unrealistic returns on offer over the last few years in the form of a fixed dividend of ¥15/share, even though reported profits have been falling steadily.  As of FY3/2019, the effective dividend payout ratio had reached a remarkable 81.5% and threatened to reach over 128% in FY3/2020 if management failed to act to preserve capital.  Reality has finally caught up with management; disgruntled investors appear to be bailing out in droves as a result, and it hurts.  Caveat emptor!  (May the buyer beware!)

The stock price of Senshu Ikeda Holdings (8714 JP) , a medium-sized bank holding company based in Osaka, fell just over 15% today, a day after announcing FY3/2019 results that beat guidance but nevertheless represented a 27% YoY decline.  What irked investors, however, was not the underwhelming results per se but management’s decision to ‘take away the punchbowl from the partygoers’ by halving the dividend for FY3/2020 to just ¥7.5/share.  Investors have clearly enjoyed the unrealistic returns on offer over the last few years in the form of a fixed dividend of ¥15/share, even though reported profits have been falling steadily.  As of FY3/2019, the effective dividend payout ratio had reached a remarkable 81.5% and threatened to reach over 128% in FY3/2020 if management failed to act to preserve capital.  Reality has finally caught up with management; disgruntled investors appear to be bailing out in droves as a result, and it hurts.  Caveat emptor!  (May the buyer beware!)

Senshu Ikeda Holdings  (8714 JP):  Reality Hurts