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>Headline NPL figures at <a href="https://www.smartkarma.com/entities/kb-financial-group-inc" target="_blank" data-smartkarma-citation="entities:718:1" rel="noopener">KB Financial (105560 KS)</a> are already of major concern rising by 49% in the past year to 3Q24</li>
<li>Granular loan classification data is of even greater concern, where substandard loans are up from KRW1,153bn to KRW1,715bn over the same period</li>
<li>This more benign bucket of NPLs well overshadows loss loans, can migration can mean a substantial rise in credit costs</li>
</ul>


Headline NPL figures at KB Financial (105560 KS) are already of major concern rising by 49% in the past year to 3Q24
Granular loan classification data is of even greater concern, where substandard loans are up from KRW1,153bn to KRW1,715bn over the same period
This more benign bucket of NPLs well overshadows loss loans, can migration can mean a substantial rise in credit costs


KB Financial - NPLs from KRW2.1tr to KRW3.1tr YoY Vs +6% Loans. Substandard Loans: Big Issue

Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>This post dives into the official details of the Korea Value-Up Index methodology that I obtained from KRX. Plus, it has the official weights and free-float rates for each constituent.</li>
<li>The 3rd and 4th Phases led to surprising stocks entering the index, causing drops for KB and Hana, while SK Hynix benefited from the Exception Application rule.</li>
<li>The index’s straightforward methodology suggests low rebalancing uncertainty, but flexible Special Entry rules and upcoming December changes may add unpredictability, targeting bank stocks like KB, Hana, and JB.</li>
</ul>


This post dives into the official details of the Korea Value-Up Index methodology that I obtained from KRX. Plus, it has the official weights and free-float rates for each constituent.
The 3rd and 4th Phases led to surprising stocks entering the index, causing drops for KB and Hana, while SK Hynix benefited from the Exception Application rule.
The index’s straightforward methodology suggests low rebalancing uncertainty, but flexible Special Entry rules and upcoming December changes may add unpredictability, targeting bank stocks like KB, Hana, and JB.


Korea Value-Up Index: Detailed Methodology, Weights, Float Rates, & Passive Impacts Obtained

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>On 26 September, the Korea Exchange announced that it is considering a <em><strong>"special rebalancing"</strong></em> of the Korea Value-Up Index in December 2024.</li>
<li>In our view, the probability of this special rebalancing occurring by the end of this year is high at about 85%+.</li>
<li>If there is a special rebalancing, KB Financial, Hana Financial, Samsung Life Insurance, SK Telecom, and KT could be considered the top candidates for inclusion. </li>
</ul>


On 26 September, the Korea Exchange announced that it is considering a "special rebalancing" of the Korea Value-Up Index in December 2024.
In our view, the probability of this special rebalancing occurring by the end of this year is high at about 85%+.
If there is a special rebalancing, KB Financial, Hana Financial, Samsung Life Insurance, SK Telecom, and KT could be considered the top candidates for inclusion. 


A Special Rebalancing Of Korea Value-Up Index Is Likely in December 2024

<ul>
<li>KRX faces challenges balancing the Value-Up Index as a benchmark while ensuring real disclosures, but passive inflows remain steady with local pension funds still interested.</li>
<li>KRX's potential December mini rebalancing increases uncertainty but may just lead to minor tweaks, adding KB and Hana while removing a few stocks from Communication Services.</li>
<li>The Value-Up Index resembles the KOSPI 200, using 30-40% GICS stocks and KOSDAQ 150, which may spark trading strategies focused on performance gaps within sectors.</li>
</ul>


KRX faces challenges balancing the Value-Up Index as a benchmark while ensuring real disclosures, but passive inflows remain steady with local pension funds still interested.
KRX's potential December mini rebalancing increases uncertainty but may just lead to minor tweaks, adding KB and Hana while removing a few stocks from Communication Services.
The Value-Up Index resembles the KOSPI 200, using 30-40% GICS stocks and KOSDAQ 150, which may spark trading strategies focused on performance gaps within sectors.


Lowdown from KRX's Emergency Presser on the Value-Up Index Today

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyzed the changes in foreign holdings of KRX stocks as of Nov 29th which has an aggregated holding worth USD481.3bn.</li>
<li>We estimate that foreign flows to be outflows of USD748mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.</li>
<li>We highlight changes of foreign holdings in Naver, Samsung Electronics, Alteogen.</li>
</ul>


We analyzed the changes in foreign holdings of KRX stocks as of Nov 29th which has an aggregated holding worth USD481.3bn.
We estimate that foreign flows to be outflows of USD748mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
We highlight changes of foreign holdings in Naver, Samsung Electronics, Alteogen.


KRX Foreign Holding Weekly (Nov 29th): Naver, Samsung Electronics, Alteogen

South Korea

KB Financial Group Inc. (the "Company"), in accordance with Financial Holding Companies Act, was established on September 29, 2008, through stock transfer with the former shareholders of its subsidiaries including Kookmin Bank in order to provide management services and financing to associated companies. The headquarters are located at Seoul, Korea

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KB Financial (105560 KS)

KB Financial - NPLs from KRW2.1tr to KRW3.1tr YoY Vs +6% Loans. Substandard Loans: Big Issue

KB Financial shows relatively benign credit costs, but NPLs are surging, and its substandard loan growth is especially high. Risks remain for much...

Daniel Tabbush

Korea Value-Up Index: Detailed Methodology, Weights, Float Rates, & Passive Impacts Obtained

This post provides the detailed methodology of the Korea Value-Up Index, which I obtained from KRX, along with the latest weights, free-float...

Sanghyun Park

A Special Rebalancing Of Korea Value-Up Index Is Likely in December 2024

On 26 September, the Korea Exchange announced that it is considering a "special rebalancing" of the Korea Value-Up Index in December 2024.

Douglas Kim

Lowdown from KRX's Emergency Presser on the Value-Up Index Today

This post provides the essential details and key takeaways from KRX's emergency press event on the Value-Up Index today, highlighting...

Sanghyun Park

KRX Foreign Holding Weekly (Nov 29th): Naver, Samsung Electronics, Alteogen

We analyzed KRX foreign holding data for the past week and highlighted foreign holding changes in Naver, Samsung Electronics, Alteogen.

Ke Yan, CFA, FRM

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)