China Macroeconomics & Academia

Christopher Balding

Macroeconomics

The upcoming foreign exchange reserve and trade balance release give us a good opportunity to examine the post-Chinese New Year capital and goods flows in light of the strengthening RMB.  While the trade surplus, FX reserves, and outflows should be closely linked given the unique factors of Chinese data, we need to explore them carefully.Let us begin with trade data.  Chinese data shows strong seasonality with March and April being the months with the largest level of month over month changes…

The upcoming foreign exchange reserve and trade balance release give us a good opportunity to examine the post-Chinese New Year capital and goods flows in light of the strengthening RMB.  While the trade surplus, FX reserves, and outflows should be closely linked given the unique factors of Chinese data, we need to explore them carefully.Let us begin with trade data.  Chinese data shows strong seasonality with March and April being the months with the largest level of month over month changes…

Lots of ink or ones and zeros in today’s world about the explosion of credit propping up the Chinese economy.  So much so that I really will not rehash this plot of land.  I think what is interesting, and really most worrying, is how little impact the credit explosion has had on real economic activity.The current credit explosion we are witnessing in China is bigger in absolute term than some of the post-GFC pops in credit and by some relative measures even bigger in relative terms.  Only the…

Lots of ink or ones and zeros in today’s world about the explosion of credit propping up the Chinese economy.  So much so that I really will not rehash this plot of land.  I think what is interesting, and really most worrying, is how little impact the credit explosion has had on real economic activity.The current credit explosion we are witnessing in China is bigger in absolute term than some of the post-GFC pops in credit and by some relative measures even bigger in relative terms.  Only the…

What Is Really Worrying About the Chinese Credit Bubble

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)

While we tend to focus on impaired loans, a look at credit-risk assets can be revealing.This is especially the case with respect to the rate of change and compared with underlying assets. For instance, if a bank is reporting a sharp rise in its credit risk assets but only a slight rise in loans, this can suggest worsening credit metrics.In practice, this would likely mean deterioration in the probability of default (PD) or loss given default (LGD) of its loans.HSBC’s data is telling, where for…

While we tend to focus on impaired loans, a look at credit-risk assets can be revealing.This is especially the case with respect to the rate of change and compared with underlying assets. For instance, if a bank is reporting a sharp rise in its credit risk assets but only a slight rise in loans, this can suggest worsening credit metrics.In practice, this would likely mean deterioration in the probability of default (PD) or loss given default (LGD) of its loans.HSBC’s data is telling, where for…

A Look at Credit Risk Assets Can Be Revealing

Founder-CEO & Chief Analyst, Real Estate Foresight

Robert Ciemniak

Founder-CEO & Chief Analyst

Real Estate Foresight

Since 2012, REF has been helping investors with market research, project due diligence, and strategy development. This has ranged from detailed assessments and estimates on distressed developers' project portfolios to market due diligence on specific projects to macro-level questions linked to demand for commodities. The unique combination of the housing markets and developer data from data partner China Index Academy in Beijing, primary research, and technology-powered alternative data collection from public sources result in a valuable content set used in REF analytics and reports.

Predictive Analytics for China Property

China house prices for 100 major cities overall continued to rise at faster pace, 9% y/y compared to 7.4% a month earlier, according to new data from SouFun-CREIS, though with highly divergent performance across the cities. The strong index-level price growth this year has been largely driven by Shenzhen, Shanghai and cities near the Tier-1 cities, benefiting from spill-over effect: Dongguan, Huizhou, Zhuhai and Zhongshan near Shenzhen, Kunshan near Shanghai, Baoding and Langfang near Beijing…

China house prices for 100 major cities overall continued to rise at faster pace, 9% y/y compared to 7.4% a month earlier, according to new data from SouFun-CREIS, though with highly divergent performance across the cities. The strong index-level price growth this year has been largely driven by Shenzhen, Shanghai and cities near the Tier-1 cities, benefiting from spill-over effect: Dongguan, Huizhou, Zhuhai and Zhongshan near Shenzhen, Kunshan near Shanghai, Baoding and Langfang near Beijing…

China House Prices in April Increased at Faster Pace Overall, Highly Divergent Across Cities

<ul><li>In China bad loan coverage ratios are falling fast, and there is talk that regulators will even lower minimum requirements. No good can come of this.</li><li>OCBC’s recent disclosure is interesting in two respects, where we believe there has been little focus.</li><li>While headline profit growth at HDFC Bank may be wonderful, we are doubtful that the market is aware underlying bad loan growth.</li></ul>

In China bad loan coverage ratios are falling fast, and there is talk that regulators will even lower minimum requirements. No good can come of this.OCBC’s recent disclosure is interesting in two respects, where we believe there has been little focus.While headline profit growth at HDFC Bank may be wonderful, we are doubtful that the market is aware underlying bad loan growth. 

China

China CITIC Financial Asset Management Co., Ltd. is primarily engaged in distressed asset management, financial services, and asset management and investment businesses. Its core business, distressed asset management, involves the disposal of troubled assets, revitalization of problematic projects, restructuring of struggling enterprises, and relief of institutions in crisis. The company is headquartered in Beijing, PRC, and was founded on November 1, 1999.

China CITIC Financial Asset Management (2799 HK)

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China CITIC Financial Asset Management (2799 HK)

Trade and FX Reserve Pre-Release Note

The upcoming foreign exchange reserve and trade balance release give us a good opportunity to examine the post-Chinese New Year capital and goods...

Christopher Balding

What Is Really Worrying About the Chinese Credit Bubble

Lots of ink or ones and zeros in today’s world about the explosion of credit propping up the Chinese economy. So much so that I really will not...

Christopher Balding

A Look at Credit Risk Assets Can Be Revealing

While we tend to focus on impaired loans, a look at credit-risk assets can be revealing.This is especially the case with respect to the rate of...

Daniel Tabbush

China House Prices in April Increased at Faster Pace Overall, Highly Divergent Across Cities

China house prices for 100 major cities overall continued to rise at faster pace, 9% y/y compared to 7.4% a month earlier, according to new data...

Robert Ciemniak

Asian Banks – Ruminations

In China bad loan coverage ratios are falling fast, and there is talk that regulators will even lower minimum requirements. No good can come of...

Daniel Tabbush

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