Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

<ul>
<li>Maybank reported 4Q21 NPAT of MYR 2.1 bn, improving MYR 372 mn (22.1%) linked quarter, reflecting revenue improvement across the board and a provision cut; </li>
<li>Net new NPLs aggregate MYR 2.3 bn, intimates an 83.4% QOQ increase in problem loans on an annualized basis; and  </li>
<li>Maybank was less than aggressive provisioning, and now an MYR 8.0 bn reserve shortfall exists today in its loan loss reserve or three quarters of NPAT. </li>
</ul>


Maybank reported 4Q21 NPAT of MYR 2.1 bn, improving MYR 372 mn (22.1%) linked quarter, reflecting revenue improvement across the board and a provision cut; 
Net new NPLs aggregate MYR 2.3 bn, intimates an 83.4% QOQ increase in problem loans on an annualized basis; and  
Maybank was less than aggressive provisioning, and now an MYR 8.0 bn reserve shortfall exists today in its loan loss reserve or three quarters of NPAT. 


Malayan Banking – Heightened Credit Risk

External broker reports(aggregated public sources), TA Securities Holdings Berhad

TA Securities Holdings Bhd

External broker reports(aggregated public sources)

<div class="content-highlight">Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</div>

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

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.

<a href="https://www.smartkarma.com/entities/ammb-holdings-bhd" target="_blank" data-smartkarma-citation="entities:137:1" rel="noopener">AMMB Holdings (AMM MK)</a> is one of the least expensive banks in Emerging Asean at 0.5x PB and certainly larger than most all of the 10 least expensive banks, at $2.5bn in market cap.  The bank’s credit cost delta can prove substantial to support ROA back to more normal levels, although this may not transpire in the current quarter.

AMMB Holdings (AMM MK) is one of the least expensive banks in Emerging Asean at 0.5x PB and certainly larger than most all of the 10 least expensive banks, at $2.5bn in market cap.  The bank’s credit cost delta can prove substantial to support ROA back to more normal levels, although this may not transpire in the current quarter. 

Global Bank Equity Specialist, Creative Portfolios

Paul Hollingworth

Global Bank Equity Specialist

Creative Portfolios

<a href="https://www.smartkarma.com/entities/ammb-holdings-bhd" target="_blank" data-smartkarma-citation="entities:137:1" rel="noopener">Ammb Holdings (AMM MK)</a>  shows benign fundamental momentum (high PH Score™) with improved Liquidity and Capitalisation, stable Asset Quality and NIM, and a standout enhancement in Efficiency which cushioned the blow of higher Credit Costs.Our PH Score™ shows that the bank is making marked headway on the Efficiency front which is a key variable to underpin Profitability moving forward given a stable though thin NIM. Liquidity and Capitalisation trends are benign too while Asset Quality is stable. The top-line shows moderate growth, in line with Credit expansion, and lower Funding Costs while “non-core Income” represented 23% of PT Profit – an indication of reasonable earnings quality- despite robust trading gains. The bottom-line was impacted lower by higher Credit Costs as elsewhere (with the exception of China) which may reverse going forward. Comprehensive Income was in excess of Net Profit – a good sign.<div class="content-highlight">VFM expresses an asset according to its value-quality characteristics (PH Score™), its technical picture, and an additional valuation filter. AMMB is in the top decile globally.</div>AMMB is looking at focusing its core operations away from insurance which may unlock long-term value.The shares are not dear. A FV of 8%, a PBV of 0.47x, an Earnings Yield of 15.7%, a Dividend Yield of 4.5%, and a Total Return Ratio of 1.6x are not unattractive. Shares thus trade below common-sense thresholds of 10% (FV), 1x (PBV), 10% (EY), and 1x (TRR) respectively.  <div class="content-highlight">The PH Score™ is a fundamental momentum-quantamental score that scores banks according to changes in value-quality. The Score encompasses Profitability, Operating Efficiency, Liquidity, Capital, Asset Quality, and Coverage as well as a valuation variable. Scores lie between 0 and 10, with higher scores representing more positive signs. The PH Score™ was back tested over 2007-17 for global banks and conclusively shows progressively higher returns across quintiles ranked by Score. </div>

Ammb Holdings (AMM MK)  shows benign fundamental momentum (high PH Score™) with improved Liquidity and Capitalisation, stable Asset Quality and NIM, and a standout enhancement in Efficiency which cushioned the blow of higher Credit Costs.Our PH Score™ shows that the bank is making marked headway on the Efficiency front which is a key variable to underpin Profitability moving forward given a stable though thin NIM. Liquidity and Capitalisation trends are benign too while Asset Quality is stable. The top-line shows moderate growth, in line with Credit expansion, and lower Funding Costs while “non-core Income” represented 23% of PT Profit – an indication of reasonable earnings quality- despite robust trading gains. The bottom-line was impacted lower by higher Credit Costs as elsewhere (with the exception of China) which may reverse going forward. Comprehensive Income was in excess of Net Profit – a good sign.VFM expresses an asset according to its value-quality characteristics (PH Score™), its technical picture, and an additional valuation filter. AMMB is in the top decile globally.AMMB is looking at focusing its core operations away from insurance which may unlock long-term value.The shares are not dear. A FV of 8%, a PBV of 0.47x, an Earnings Yield of 15.7%, a Dividend Yield of 4.5%, and a Total Return Ratio of 1.6x are not unattractive. Shares thus trade below common-sense thresholds of 10% (FV), 1x (PBV), 10% (EY), and 1x (TRR) respectively.  The PH Score™ is a fundamental momentum-quantamental score that scores banks according to changes in value-quality. The Score encompasses Profitability, Operating Efficiency, Liquidity, Capital, Asset Quality, and Coverage as well as a valuation variable. Scores lie between 0 and 10, with higher scores representing more positive signs. The PH Score™ was back tested over 2007-17 for global banks and conclusively shows progressively higher returns across quintiles ranked by Score. 

AMMB: Top Decile PH Score™ and VFM Asset

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Last Week in Event SPACE: Infigen, Huadian Fuxin, Melco, Evergrande, Hitachi, Sing Air, DP World

Malaysia

AMMB Holdings Berhad is an investment holding company.  The Company, through its subsidiaries, provides merchant and commercial banking, retail financing, stock and futures broking, and investment advisory. AMMB also underwrites general insurance, provides asset and unit trust management, and nominees services.

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AMMB Holdings (AMM MK)

Malayan Banking – Heightened Credit Risk

MAYBANK: Maybank reported QOQ 4Q21 NPAT increase of 22.1%, reflecting revenue improvement and a provision cut. NPLs accelerated while reserves...

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A Fresh Start

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TA Securities Holdings Bhd

AMMB – Will Valuation Gap Narrow?

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Daniel Tabbush

AMMB: Top Decile PH Score™ and VFM Asset

AMMB: Top Decile PH Score™ and VFM asset AMMB shows benign fundamental momentum (high PH Score™) with improved Liquidity and Capitalisation,...

Paul Hollingworth

Last Week in Event SPACE: Infigen, Huadian Fuxin, Melco, Evergrande, Hitachi, Sing Air, DP World

Last Week in Event SPACE ... The Infigen Energy (IFN AU) deal is effectively unconditional as long as there are no major conditions breached,...

David Blennerhassett

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