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.

Thematic (Sector/Industry)

<ul><li>Philippine banks are now taking over others in SE Asia in terms of credit growth&nbsp;as they become more comfortable with their own financials and the overall economy.</li><li>Indonesian Bank loan growth has stepped down dramatically over the past few years. This reflects cyclically less corporate demand combined with increased caution from the banks</li><li>Thai Banks now report the lowest growth. With GDP growing at 0.5% this is reflective of demand.</li></ul>

Philippine banks are now taking over others in SE Asia in terms of credit growth&nbsp;as they become more comfortable with their own financials and the overall economy.Indonesian Bank loan growth has stepped down dramatically over the past few years. This reflects cyclically less corporate demand combined with increased caution from the banksThai Banks now report the lowest growth. With GDP growing at 0.5% this is reflective of demand.

South East Asian Loan Growth  - Phillippine, Thai and Indonesian Banks Compared.

Poor loan processing caused high NPLs, and this is now changing. &nbsp;As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x PB, BJBR is cheap vs peers, and with a high 10% dividend yield.

Poor loan processing caused high NPLs, and this is now changing. &nbsp;As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x PB, BJBR is cheap vs peers, and with a high 10% dividend yield.

A cheap Indonesian bank, with a 10% yield, where NPLs will decline fast. 

<ul><li>A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ &nbsp;combine to create a world of worry in markets and bank stocks in particular. The way this usually plays out is first with liquidity.&nbsp; </li><li>Banks pull credit lines from weaker banks (and weaker companies).&nbsp; </li><li>If a bank has a loan to deposit ratio (LDR) above 100%, it is often difficult to repay the redeemed credit line, as it means disposing of an asset, a loan – immediately. &nbsp; </li></ul>

A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ &nbsp;combine to create a world of worry in markets and bank stocks in particular. The way this usually plays out is first with liquidity.&nbsp; Banks pull credit lines from weaker banks (and weaker companies).&nbsp; If a bank has a loan to deposit ratio (LDR) above 100%, it is often difficult to repay the redeemed credit line, as it means disposing of an asset, a loan – immediately. &nbsp; 

Equity Bottom-Up

Bank Syariah Indonesia / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bank-syariah-indonesia-tbk-pt" target="_blank" data-smartkarma-citation="entities:26981:1" rel="noopener">Bank Syariah Indonesia Tbk PT (BRIS IJ)</a> reported 11% QoQ net profit in 4Q24</li>
<li>Credit costs are down nearly 75% QoQ and annually, there are improving figures</li>
<li>Fee income growth is relatively new, ROA expansion can continue, to even &gt;3% from this</li>
</ul>



Bank Syariah Indonesia Tbk PT (BRIS IJ) reported 11% QoQ net profit in 4Q24
Credit costs are down nearly 75% QoQ and annually, there are improving figures
Fee income growth is relatively new, ROA expansion can continue, to even &gt;3% from this


BRIS - Strong Numbers Just Out, Asset Growth High, Credit Costs Low, Fees Doing Well

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Waaay back in June 2023, <a href="https://www.smartkarma.com/entities/mitsubishi-ufj-financial-group" target="_blank" data-smartkarma-citation="entities:218:1" rel="noopener">MUFG (8306 JP)</a> and 92.7%-held <a href="https://www.smartkarma.com/entities/adira-dinamika-multi-finance-tbk-pt" target="_blank" data-smartkarma-citation="entities:3245:1" rel="noopener">Adira Dinamika (ADMF IJ)</a> entered into SPAs with key shareholders to acquire an 80.6% stake in <a href="https://www.smartkarma.com/entities/mandala-multifinance-tbk-pt" target="_blank" data-smartkarma-citation="entities:12756:1" rel="noopener">Mandala Multifinance (MFIN IJ)</a>.</li>
<li>MFIN's shareholders overwhelmingly approved the change of control at the 13th Feb EGM. OJK signing off was the next hurdle.</li>
<li>The Tender Offer is now open, at the (expected) price of  IDR 3,297/share. The close of the Offer is the 21st August, with payment on the 28th August. </li>
</ul>


Waaay back in June 2023, MUFG (8306 JP) and 92.7%-held Adira Dinamika (ADMF IJ) entered into SPAs with key shareholders to acquire an 80.6% stake in Mandala Multifinance (MFIN IJ).
MFIN's shareholders overwhelmingly approved the change of control at the 13th Feb EGM. OJK signing off was the next hurdle.
The Tender Offer is now open, at the (expected) price of  IDR 3,297/share. The close of the Offer is the 21st August, with payment on the 28th August. 


Mandala Multifinance (MFIN IJ): Offer Now Open

Indonesia

PT Bank Danamon Indonesia Tbk is an Indonesian financial institution that provides a wide range of banking services, including consumer banking, wealth management, and various credit products for individual and corporate customers. The bank offers services such as savings, loans, fund transfers, and Sharia banking. It is headquartered in Jakarta, Indonesia, and was established in 1956.

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Bank Danamon Indonesia (BDMN IJ)

South East Asian Loan Growth - Phillippine, Thai and Indonesian Banks Compared.

Philippine banks are now taking over others in SE Asia in terms of credit growth as they become more comfortable with their own financials and the...

Daniel Tabbush

A cheap Indonesian bank, with a 10% yield, where NPLs will decline fast.

Poor loan processing caused high NPLs, and this is now changing. As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x...

Daniel Tabbush

Be Wary of High LDR Banks at Present

A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ combine to create a world of worry in markets and bank...

Daniel Tabbush

BRIS - Strong Numbers Just Out, Asset Growth High, Credit Costs Low, Fees Doing Well

BRIS just released its 4Q24 results, with strong numbers. Asset growth is high, credit costs are down, fee income is improving.

Daniel Tabbush

Mandala Multifinance (MFIN IJ): Offer Now Open

The Tender Offer is now open, at the (expected) price of IDR 3,297/share. The close of the Offer is the 21st August, with payment on the 28th August.

David Blennerhassett

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52-week Range

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