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

Mizuho Financial Group / Equity Bottom-Up

<ul>
<li>Mizuho has well positioned for YCCC relief with its balance sheet management in 1Q24</li>
<li>Less low yielding cash assets, higher loans, securities, shift into NCDs, from deposits</li>
<li>Mizuho reports credit costs reversals and better credit metrics are clear in NPL detail</li>
</ul>


Mizuho has well positioned for YCCC relief with its balance sheet management in 1Q24
Less low yielding cash assets, higher loans, securities, shift into NCDs, from deposits
Mizuho reports credit costs reversals and better credit metrics are clear in NPL detail


Mizuho - Strong Balance Sheet Management & With Better Credit Metrics

<ul>
<li>Results show dramatically lower NIM, net interest income, but stock gains in spades</li>
<li>The only way to analyze 7182 is to have a view on its stock, bonds, investment gains</li>
<li>Unrealized gains more than doubled to JPY472bn: fire-power remains, but is it valuable?</li>
</ul>


Results show dramatically lower NIM, net interest income, but stock gains in spades
The only way to analyze 7182 is to have a view on its stock, bonds, investment gains
Unrealized gains more than doubled to JPY472bn: fire-power remains, but is it valuable?


Japan Post Bank - JPY234bn in Gains More than Offsets Cratering Net Interest Income

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bank-of-kyoto" target="_blank" data-smartkarma-citation="entities:5248:1" rel="noopener">Bank of Kyoto (8369 JP)</a> has been on a relative tear recently. This is a bit surprising.  On a static equity-portfolio discount measure, it has outperformed regional banks.</li>
<li>On a static regional bank PBR basis, it has outperformed its equity portfolio and the discount to the After Tax Equity Portfolio Value (ATEPV) is the smallest in eight years.</li>
<li>Is there a sea change? There is a possibility, however remote, that domestic investor disappointment rears its voting head. That's the dream scenario. But I don't see it coming soon.</li>
</ul>



Bank of Kyoto (8369 JP) has been on a relative tear recently. This is a bit surprising.  On a static equity-portfolio discount measure, it has outperformed regional banks.
On a static regional bank PBR basis, it has outperformed its equity portfolio and the discount to the After Tax Equity Portfolio Value (ATEPV) is the smallest in eight years.
Is there a sea change? There is a possibility, however remote, that domestic investor disappointment rears its voting head. That's the dream scenario. But I don't see it coming soon.


<ul>
<li>If there is no relief on yield curve control (YCC) anytime soon, seek banks with low JGBs</li>
<li>Chiba Bank is one of few banks in Japan where JGBs are nearly a rounding error vs assets</li>
<li>A pure play on an improving Japan, focused next door to Tokyo, with falling NPLs</li>
</ul>


If there is no relief on yield curve control (YCC) anytime soon, seek banks with low JGBs
Chiba Bank is one of few banks in Japan where JGBs are nearly a rounding error vs assets
A pure play on an improving Japan, focused next door to Tokyo, with falling NPLs


Chiba Bank - Less Yield Curve Control Issue With Near Zero JGBs

<ul>
<li>Mizuho's current tax expenses can see normalization that restores profitability by June quarter</li>
<li>Yield curve control relief coming at a time of tax normalization, can be significant to profit</li>
<li>Credit costs have moved higher, but the magnitude may wane, given NPL distribution</li>
</ul>


Mizuho's current tax expenses can see normalization that restores profitability by June quarter
Yield curve control relief coming at a time of tax normalization, can be significant to profit
Credit costs have moved higher, but the magnitude may wane, given NPL distribution


Mizuho - Tax Rate Normalization, Yield Curve Control Relief, Can Mean Profit Surge

Japan

The Chiba Bank, Ltd. is a regional bank based in Chiba Prefecture. The Bank offers general banking services including deposits, loans, and foreign exchange transactions. The Chiba Bank also develops software and provides financial services such as leasing, securities brokerage, letter of credit, and credit cards.

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Chiba Bank (8331 JP)

Mizuho - Strong Balance Sheet Management & With Better Credit Metrics

JGB yields are surging now up to 0.657% where Mizuho can benefit substantially, also with likely sharply higher company profit forecast. Weakening...

Daniel Tabbush

Japan Post Bank - JPY234bn in Gains More than Offsets Cratering Net Interest Income

Japan Post Bank profit is entirely driven by gains on bonds, stocks, securities, and this can continue. It may though be considered low quality,...

Daniel Tabbush

Bank of Kyoto (8369) - Too Far Too Fast

Bank of Kyoto (8369) has a 50% payout but its shareholder base isn’t that supportive of activism need to monetise the value of the equity...

Travis Lundy

Chiba Bank - Less Yield Curve Control Issue With Near Zero JGBs

With BOJ move for some nimble YCCC relief it becomes important to differentiate between Japan's banks with duration and bonds.

Daniel Tabbush

Mizuho - Tax Rate Normalization, Yield Curve Control Relief, Can Mean Profit Surge

A normalization of current tax expenses, can completely restore profit, and where this occurs with YCC relief, the profit impact can be...

Daniel Tabbush

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