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>
A50 Challenges:Hong Kong Exchange &amp; Clearing (388.HK) [HKEx] launched the MSCI China A50 Connect (HK A50). This new product competes with 20% of Singapore Exchange’s (SGX.SP) [SGX] PBT; </li>
<li>
Completely Distracted: On top of weaker equity volumes/fees and the HK A50 launch, SGX has made numerous moves which are more of a distraction than they're worth; and </li>
<li>
Time For Massive Strategic Move: SGX must consider significant strategic alternatives if it is to avoid being hollowed out over the longer-term.</li>
</ul>



A50 Challenges:Hong Kong Exchange &amp; Clearing (388.HK) [HKEx] launched the MSCI China A50 Connect (HK A50). This new product competes with 20% of Singapore Exchange’s (SGX.SP) [SGX] PBT; 

Completely Distracted: On top of weaker equity volumes/fees and the HK A50 launch, SGX has made numerous moves which are more of a distraction than they're worth; and 

Time For Massive Strategic Move: SGX must consider significant strategic alternatives if it is to avoid being hollowed out over the longer-term.


<ul>
<li>
C’mon Guys, Where Have You Been?: S&amp;P issued a scathing report suggesting that China Evergrande Group (3333.HK) [Evergrande] “will likely default because the company has lost its main business”;</li>
<li>
Other Pearls:S&amp;P also believes that “Evergrande’s massive debt will catch up with it”; and    </li>
<li>
Ratings Agencies Are More Than Culpable: Wouldn’t you know it, the sleepy, fee hungry ratings agencies are finally starting work on Evergrande after the market embarrasses them once again.</li>
</ul>



C’mon Guys, Where Have You Been?: S&amp;P issued a scathing report suggesting that China Evergrande Group (3333.HK) [Evergrande] “will likely default because the company has lost its main business”;

Other Pearls:S&amp;P also believes that “Evergrande’s massive debt will catch up with it”; and    

Ratings Agencies Are More Than Culpable: Wouldn’t you know it, the sleepy, fee hungry ratings agencies are finally starting work on Evergrande after the market embarrasses them once again.


<ul>
<li>
An NDR About Nothing: A competitor held a non-deal roadshow for Tencent Holdings (700.HK) [Tencent]. Management only addressed matters discussed at its challenged 3Q21 results; </li>
<li>
Elephant In The Room:Management continues to avoid any serious discussion of  mainland China’s broad restrictions on FinTech – which represents a growing 30.4% of revenue; and </li>
<li>
Stop The Spin Doctoring:No matter Tencent’s spin, a financial holding company represents significant downside risks as earnings will compress and capital requirements increase.</li>
</ul>



An NDR About Nothing: A competitor held a non-deal roadshow for Tencent Holdings (700.HK) [Tencent]. Management only addressed matters discussed at its challenged 3Q21 results; 

Elephant In The Room:Management continues to avoid any serious discussion of  mainland China’s broad restrictions on FinTech – which represents a growing 30.4% of revenue; and 

Stop The Spin Doctoring:No matter Tencent’s spin, a financial holding company represents significant downside risks as earnings will compress and capital requirements increase.


Tencent Holdings – Seinfeld-Ian Roadshow

<ul>
<li>
Better, But Off A Low Base: AIA Group's (1299.HK) [AIA] limited set of 3Q21 results, where VONB declined 3.5% on a linked quarter basis due weaker new sales volume; </li>
<li>
Many Deal Distractions:AIA has gone on a deal-making spree in 2021, announcing six separate transactions to date; and  </li>
<li>
Suffocating Hong Kong Business: AIA’s core Hong Kong business has been an unmitigated disaster during COVID-19, struggling with mainland Chinese visitors. Further, there is limited clarity on AIA’s legacy agents. </li>
</ul>



Better, But Off A Low Base: AIA Group's (1299.HK) [AIA] limited set of 3Q21 results, where VONB declined 3.5% on a linked quarter basis due weaker new sales volume; 

Many Deal Distractions:AIA has gone on a deal-making spree in 2021, announcing six separate transactions to date; and  

Suffocating Hong Kong Business: AIA’s core Hong Kong business has been an unmitigated disaster during COVID-19, struggling with mainland Chinese visitors. Further, there is limited clarity on AIA’s legacy agents. 


AIA Group – No Word On Massive Deal Risk

<ul>
<li>
USD Bond Payments Continue:  China Evergrande Group (3333.HK) [Evergrande] magically made another set of 11th hour interest payments of USD 148 mn to bondholders on Wednesday, November 10, 2021;</li>
<li>
Trial Balloon Not a Panacea: Mainland Chinese authorities hinted a readiness to loosen their grip on the issuance of CNY-denominated bonds by real estate companies; and</li>
<li>
Watch Your Bank Risk: Evergrande has already been in contact with lenders for loan extensions. Main bank, Shenjang Bank is on the verge of announcing 20% plus NPLs. </li>
</ul>



USD Bond Payments Continue:  China Evergrande Group (3333.HK) [Evergrande] magically made another set of 11th hour interest payments of USD 148 mn to bondholders on Wednesday, November 10, 2021;

Trial Balloon Not a Panacea: Mainland Chinese authorities hinted a readiness to loosen their grip on the issuance of CNY-denominated bonds by real estate companies; and

Watch Your Bank Risk: Evergrande has already been in contact with lenders for loan extensions. Main bank, Shenjang Bank is on the verge of announcing 20% plus NPLs. 


China Evergrande Group – Making Those Payments

Hong Kong

iShares MSCI Hong Kong ETF is an exchange-traded fund incorporated in the USA. The ETF's objective seeks to provide investment results that correspond to the performance of publicly traded securities in the Hong Kong market, as measured by the MSCI Hong Kong Index. The ETF invests in a representative sample of index stocks using a "portfolio sampling" technique.

iShares MSCI Hong Kong ETF (EWH US)

Singapore Exchange - Ringing Hollow

SGX: A50 Challenges: HKEx launched the MSCI China A50 Connect, which directly competes with 20% of SGX' PBT. A recent competitor event revealed...

Thomas J. Monaco

China Evergrande Group – Thanks S&P

EVERGRANDE: S&P issued a scathing report suggesting that Evergrande “will likely default because the company has lost its main business. Not...

Thomas J. Monaco

Tencent Holdings – Seinfeld-Ian Roadshow

TENCENT: Tencent addressed matters it had already discussed at its challenged 3Q21 results. Unfortunately there was no serious discussion of...

Thomas J. Monaco

AIA Group – No Word On Massive Deal Risk

AIA: AIA reported a limited set of 3Q21 results, where VONB declined 3.5% on a linked quarter basis due weaker new sales volume. No word on AIA's...

Thomas J. Monaco

China Evergrande Group – Making Those Payments

EVERGRANDE: Evergrande magically made another set of 11th hour interest payments of USD 148 mn to bondholders on Wednesday, November 10, 2021 -...

Thomas J. Monaco