Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

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

The Bank of East Asia, Limited and its subsidiaries provide general banking, related financial, business corporate, and investor services.

<ul>
<li>Data from <a href="https://www.smartkarma.com/entities/bank-of-east-asia-ltd" target="_blank" data-smartkarma-citation="entities:341:1" rel="noopener">Bank of East Asia (23 HK)</a> is just out with poor 1H24 results YoY</li>
<li>Notable in its release are its Hong Kong overdue exposure by over three months</li>
<li>Hong Kong region income is the worst affected by credit costs, this does not seem to be over</li>
</ul>


Data from Bank of East Asia (23 HK) is just out with poor 1H24 results YoY
Notable in its release are its Hong Kong overdue exposure by over three months
Hong Kong region income is the worst affected by credit costs, this does not seem to be over


BEA - Far Worse Deterioration in Hong Kong than Other Regions & Sharply Lower HFD Centa City Index

Thematic (Sector/Industry)

<ul>
<li>Australia domestic credit growth is now at -2.2% YoY in January 2024, the worst figure since August 2021. </li>
<li>There are negative implications for the delta of net interest income for Australia's banks as loan growth moves negative.</li>
<li>Risk of rising credit costs is higher, not only from worsening insolvencies with corporates, but also with rising mortgage bad loans. </li>
</ul>


Australia domestic credit growth is now at -2.2% YoY in January 2024, the worst figure since August 2021. 
There are negative implications for the delta of net interest income for Australia's banks as loan growth moves negative.
Risk of rising credit costs is higher, not only from worsening insolvencies with corporates, but also with rising mortgage bad loans. 


Australia Banks - Negative Loan Growth Reaches August 2021 Levels

National Australia Bank / Equity Bottom-Up

National Australia Bank Limited is an international banking group which operates in Australia, New Zealand, Europe, Asia and the United States.  The Group offers banking services, credit and access card facilities, leasing, housing and general finance, international and investment banking, wealth and funds management, life insurance and custodian, trustee and nominee services.

<ul>
<li>NAB reported its 3Q24 results with slightly lower profit, but major divergence inside the figures </li>
<li>The bank shows a staggering decline in credit costs in 3Q24, which means the results were flattered</li>
<li>This is despite a very sharp rise in bad loans in major segments, corporate and residential mortgages, up around 50% YoY annualized in 3Q24</li>
</ul>


NAB reported its 3Q24 results with slightly lower profit, but major divergence inside the figures 
The bank shows a staggering decline in credit costs in 3Q24, which means the results were flattered
This is despite a very sharp rise in bad loans in major segments, corporate and residential mortgages, up around 50% YoY annualized in 3Q24


NAB - Profit Slightly Down in 3Q, Credit Costs Collapsed, but Bad Loans Are Rising Significantly

<ul>
<li>High frequency data in the US for mortgage loan applications and mortgage loan volume is improving, not suggestive of recession</li>
<li>Total domestic credit growth in the US is accelerating in recent months, and this can continue given the HFD on mortgages</li>
<li>Credit metrics can remain a concern, especially in CRE and card lending, despite the improved delta in mortgage lending and total lending</li>
</ul>


High frequency data in the US for mortgage loan applications and mortgage loan volume is improving, not suggestive of recession
Total domestic credit growth in the US is accelerating in recent months, and this can continue given the HFD on mortgages
Credit metrics can remain a concern, especially in CRE and card lending, despite the improved delta in mortgage lending and total lending


US Banks & Economy - HFD Mortgage Data Shows Weekly Improvements, Credit Growth Improving in US

Tong Yang Industry Co., Ltd. manufactures and markets automobile and motorcycle parts such as bumpers, windshields, grilles, fenders, hoods, and light frames. The Company exports its products to North America, Europe, Central and South Americas, Southeast Asia, and the Middle East.

<ul>
<li>Tong Yang Industry is now seeing record profit in FY23 and this appears to be in place to continue during FY24</li>
<li>The automobile and motorcycle parts manufacturing company is seeing strong growth in the US market</li>
<li>Electric vehicle parts R&amp;D is well underway and this should support continued growth in coming years</li>
</ul>


Tong Yang Industry is now seeing record profit in FY23 and this appears to be in place to continue during FY24
The automobile and motorcycle parts manufacturing company is seeing strong growth in the US market
Electric vehicle parts R&amp;D is well underway and this should support continued growth in coming years


Tong Yang Industry - Record Profit With Improving Financial Position

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.