Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Mitsubishi UFJ Financial (MUFG) / Event-Driven

<ul>
<li>A few days ago, the TSE announced a "name-and-shame" list where they listed all the companies which had put forth a disclosure about 【資本コストや株価を意識した経営の実現に向けた対応】</li>
<li>That translates to "Action to Implement Management That is Conscious of Cost of Capital and Stock Price". The TSE asked companies in Mar-2023 to formulate and disclose a policy. </li>
<li>Some have. Some have not. The TSE made a list. They will update the list every month. However, their list is wholly inadequate, so we made it better. </li>
</ul>


A few days ago, the TSE announced a "name-and-shame" list where they listed all the companies which had put forth a disclosure about 【資本コストや株価を意識した経営の実現に向けた対応】
That translates to "Action to Implement Management That is Conscious of Cost of Capital and Stock Price". The TSE asked companies in Mar-2023 to formulate and disclose a policy. 
Some have. Some have not. The TSE made a list. They will update the list every month. However, their list is wholly inadequate, so we made it better. 


TSE Action to Implement Management Conscious of Capital Cost and Stock Price - The Data Tool

<ul>
<li>Today, <a href="https://www.smartkarma.com/entities/sumitomo-mitsui-financial-group-inc" target="_blank" data-smartkarma-citation="entities:217:1" rel="noopener">Sumitomo Mitsui Financial Group (8316 JP)</a> and <a href="https://www.smartkarma.com/entities/mitsubishi-ufj-financial-group" target="_blank" data-smartkarma-citation="entities:218:1" rel="noopener">Mitsubishi UFJ Financial (MUFG) (8306 JP)</a> reported H1 earnings. <a href="https://www.smartkarma.com/entities/mizuho-financial-group-inc" target="_blank" data-smartkarma-citation="entities:219:1" rel="noopener">Mizuho Financial Group (8411 JP)</a> reported yesterday.</li>
<li>Mizuho raised full-year NP guidance by ~5%, passing the Street. SMFG raised its FY NP guidance 12.2%, also beating the Street. MUFG didn't raise guidance but H1 saw 71% progress.</li>
<li>Today, SMFG raised its div, and both SMFG (¥150bn) and MUFG (¥400bn) announced buybacks. Cross-holding unwind progress is waaay lower than we'd like, but capital stronger as a result.</li>
</ul>


Today, Sumitomo Mitsui Financial Group (8316 JP) and Mitsubishi UFJ Financial (MUFG) (8306 JP) reported H1 earnings. Mizuho Financial Group (8411 JP) reported yesterday.
Mizuho raised full-year NP guidance by ~5%, passing the Street. SMFG raised its FY NP guidance 12.2%, also beating the Street. MUFG didn't raise guidance but H1 saw 71% progress.
Today, SMFG raised its div, and both SMFG (¥150bn) and MUFG (¥400bn) announced buybacks. Cross-holding unwind progress is waaay lower than we'd like, but capital stronger as a result.


I Like Big Bank Buybacks And I Cannot Lie

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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/japan-post-bank-co-ltd" target="_blank" data-smartkarma-citation="entities:838:1" rel="noopener">Japan Post Bank (7182 JP)</a> saw its net profit surge from non-recurring gains, which was from the sale of stocks.  </li>
<li>The company's cost of funds worsened more than the improvement in its yields, and we believe this remains an issue related to hedging costs. </li>
<li>Unrealized gains on foreign bonds remains significantly higher now than a year ago and this may again be the driver for earnings, but still with very low ROA. </li>
</ul>



Japan Post Bank (7182 JP) saw its net profit surge from non-recurring gains, which was from the sale of stocks.  
The company's cost of funds worsened more than the improvement in its yields, and we believe this remains an issue related to hedging costs. 
Unrealized gains on foreign bonds remains significantly higher now than a year ago and this may again be the driver for earnings, but still with very low ROA. 


Japan Post Bank - It's like a Closed End Mutual Fund More Than Ever

Mitsubishi UFJ Financial (MUFG) / Equity Bottom-Up

<ul>
<li>There may be no imminent yield curve control relief in Japan</li>
<li>MUFG market capitalization is up 2-3x and at a near decade peak level</li>
<li>Without YCC relief maybe the bank's 60% rise in NPLs in the past 4 years is better noticed</li>
</ul>


There may be no imminent yield curve control relief in Japan
MUFG market capitalization is up 2-3x and at a near decade peak level
Without YCC relief maybe the bank's 60% rise in NPLs in the past 4 years is better noticed


MUFG - What if No Yield Curve Control Relief?

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Mitsubishi UFJ Financial (MUFG) ADR / Equity Bottom-Up

<ul>
<li>Mitsubishi UFJ Financial Group Inc. delivered a solid result and managed an all-around beat last quarter.</li>
<li>Despite increased G&amp;A expenses, the company managed to rebound in terms of NOP, reaching a level before the introduction of negative interest rates.</li>
<li>We give Mitsubishi UFJ Financial Group Inc. a 'Hold' rating with a revised target price.</li>
</ul>


Mitsubishi UFJ Financial Group Inc. delivered a solid result and managed an all-around beat last quarter.
Despite increased G&amp;A expenses, the company managed to rebound in terms of NOP, reaching a level before the introduction of negative interest rates.
We give Mitsubishi UFJ Financial Group Inc. a 'Hold' rating with a revised target price.


Mitsubishi UFJ Financial: Their Secret Sauce in Tackling Global Economic Uncertainties

Japan

Mitsubishi UFJ Financial Group, Inc. (MUFG) is a holding company established through the merger of Mitsubishi Tokyo Financial Group and UFJ Holdings. As a financial group, the Company provides a variety of financial and investment services including commercial banking, trust banking, international finance, and assets management services.

Mitsubishi UFJ Financial (MUFG) (8306 JP)

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Mitsubishi UFJ Financial (MUFG) (8306 JP)

TSE Action to Implement Management Conscious of Capital Cost and Stock Price - The Data Tool

The TSE's announcement which some called a "name-and-shame" list for Actions to Implement Management Awareness of Cost of Capital and Stock Price...

Travis Lundy

I Like Big Bank Buybacks And I Cannot Lie

Japan's Three Megabanks reported earnings on 13-14 November. Two raised FY guidance above the street. MUFG did not raise guidance but H1 saw 71%...

Travis Lundy

Japan Post Bank - It's like a Closed End Mutual Fund More Than Ever

Japan Post Bank is more than ever like a closed-end mutual fund, which is hardly seeing any line items drive profit upward other than stock sales,...

Daniel Tabbush

MUFG - What if No Yield Curve Control Relief?

Maybe there is no imminent yield curve control relief in Japan, making the market cap gains at MUFG questionable, especially against 60% higher bad...

Daniel Tabbush

Mitsubishi UFJ Financial: Their Secret Sauce in Tackling Global Economic Uncertainties

Mitsubishi UFJ Financial Group Inc. delivered a solid result and managed an all-around beat last quarter. Despite increased G&A expenses, the...

Baptista Research

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