Senior Bank Analyst - Japanese Banks, Windamee Research

J. Brian Waterhouse

Senior Bank Analyst - Japanese Banks

Windamee Research

Japanese Banks

Equity Bottom-Up

Sumitomo Mitsui Financial Group / Equity Bottom-Up

<ul>
<li>Interim FY3/2022 results for SMFG (8316 JP) were good, with improvement in core earnings in both 1Q and 2Q, together with a sharp reduction in credit costs, driving the results.</li>
<li>Consolidated net profits of ¥456.06 billion were not only up +68.8% over 1H FY3/2021 but represented 76% of SMFG’s original full-year guidance.</li>
<li>FY guidance is raised from ¥600 billion to ¥670 billion.  The dividend has been raised from ¥190ps to ¥210ps.  SMFG has announced a ¥100bn share buyback.</li>
</ul>


Interim FY3/2022 results for SMFG (8316 JP) were good, with improvement in core earnings in both 1Q and 2Q, together with a sharp reduction in credit costs, driving the results.
Consolidated net profits of ¥456.06 billion were not only up +68.8% over 1H FY3/2021 but represented 76% of SMFG’s original full-year guidance.
FY guidance is raised from ¥600 billion to ¥670 billion.  The dividend has been raised from ¥190ps to ¥210ps.  SMFG has announced a ¥100bn share buyback.


Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

Equity Capital Markets

Japan Post Holdings / Equity Capital Markets

<div><p>The Japanese government plans to sell over 26% or US$8bn worth of <a href="https://www.smartkarma.com/entities/japan-post-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:359:1" rel="noopener">Japan Post Holdings (6178 JP).</a> We've covered most most aspects of the deal in our previous note, <a href="https://www.smartkarma.com/insights/japan-post-holdings-placement-the-final-us-8bn-countdown-past-deal-didn-t-do-well" target="_blank" rel="noopener">Japan Post Holdings Placement - The Final US$8bn Countdown - Past Deal Didn’t Do Well</a>. </p></div><div><p>In this note, we will talk about the updates and the share price performance so far.</p></div>

The Japanese government plans to sell over 26% or US$8bn worth of Japan Post Holdings (6178 JP). We've covered most most aspects of the deal in our previous note, Japan Post Holdings Placement - The Final US$8bn Countdown - Past Deal Didn’t Do Well. In this note, we will talk about the updates and the share price performance so far.

Japan Post Holdings Placement - The Final US$8bn Countdown - Shaping up Better than the Last Deal

Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

<p>With interest rates beginning to rise worldwide, more and more attention is being paid to banking stocks. In Japan, it has been said that banks are a sector with a strong sense of horizontal alignment. In this article, I will consider the corporate governance aspects of bank stocks. 72 banks are included in the 1,709 companies in the Metrical Universe as of September 2021. The table below shows the median and mean metrics for the 72 banks in the metrical universe, including ROE, ROA, Tobin's Q, and the Metrical Score, a measure of corporate governance, and one component of the Metrical Score, the percentage of total board members who are independent directors.</p>

With interest rates beginning to rise worldwide, more and more attention is being paid to banking stocks. In Japan, it has been said that banks are a sector with a strong sense of horizontal alignment. In this article, I will consider the corporate governance aspects of bank stocks. 72 banks are included in the 1,709 companies in the Metrical Universe as of September 2021. The table below shows the median and mean metrics for the 72 banks in the metrical universe, including ROE, ROA, Tobin's Q, and the Metrical Score, a measure of corporate governance, and one component of the Metrical Score, the percentage of total board members who are independent directors.

Japan's Governance: Considerations for Bank Stocks

Bond market data and technology, BondEvalue

BondEvalue

Bond market data and technology

BondEvalue is a Singapore-based Fintech that specializes in bond market data and technology. The company's information services business offers bond market data on hard-currency corporate & sovereign bonds across Asia, Middle East, Europe and the Americas. The data, which includes bond prices, yields, news and analytics, is offered to end investors via interactive Mobile and Web Apps. Investors can sign up for a free trial of the service either via the company's website (https://bondevalue.com) or by downloading the BondEvalue Mobile App (http://onelink.to/wej7jq). BondEvalue is also developing an electronic bond exchange, BondbloX in Singapore that allows investors to trade bonds electronically in smaller sizes (US$1,000 or equivalent). For more information, visit https://www.bondblox.com/

Bond Market Data and Technology

Credit

US markets saw a sharp drop yesterday, continuing its volatile movement from last week – S&amp;P and Nasdaq were down 1.3% and 2.4% respectively. US 10Y Treasury yields were marginally higher by 1bp to 1.48%. Energy and Utilities were up over 1.4% while IT and Communication Services were down over 2.1%. European stocks were also lower with the DAX falling 0.8%, CAC falling 0.6% and FTSE down 0.2%. Brazil’s Bovespa was down sharply by 2.2%. In the Middle East, UAE’s ADX was down 0.3% and Saudi TASI was up 0.1%. Asia Pacific markets are broadly lower again – STI is down 0.8% and Nikkei 2.8% while Shanghai remains closed, HSI recovered after opening ~1% lower and was up 0.3%,. US IG CDS spreads were 0.95bp wider while HY CDX spreads widened 4.7bp. EU Main CDS spreads were 0.9bp wider and Crossover CDS spreads widened 5bp. Asia ex-Japan CDS spreads widened 0.1bp.

HDB, MUFG Launch Bonds; Macro; Rating Changes; New Issues; Talking Heads; Top Gainers and Losers

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<p>Our biggest concerns have stemmed from a handful of large-cap China internet names, which have held back the MSCI EM and Hang Seng indexes. We are also getting a breakout above $93.50-93.75 on the US dollar, a concerning risk-off signal. Still, our list of concerns remains short, and our outlook remains neutral yet constructive overall.</p>

Our biggest concerns have stemmed from a handful of large-cap China internet names, which have held back the MSCI EM and Hang Seng indexes. We are also getting a breakout above $93.50-93.75 on the US dollar, a concerning risk-off signal. Still, our list of concerns remains short, and our outlook remains neutral yet constructive overall.

Global Cyclical Value Sectors Improving -- Buying Financials and Energy Names: ING Groep, Many More

Japan

Mitsubishi UFJ Financial Group, Inc. (MUFG) is a holding company established through the merger of Mitsubishi Tokyo Financial Group and UFJ Holdings. As a financial group, the Company provides a variety of financial and investment services including commercial banking, trust banking, international finance, and assets management services.

Mitsubishi UFJ Financial (MUFG) (8306 JP)

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Mitsubishi UFJ Financial (MUFG) (8306 JP)

SMFG (8316 JP): Disciplined Numbers

Interim FY3/2022 results for SMFG (8316 JP) were good, with improvement in core earnings in both 1Q and 2Q, together with a sharp reduction in...

J. Brian Waterhouse

Japan Post Holdings Placement - The Final US$8bn Countdown - Shaping up Better than the Last Deal

The Japanese government plans to sell over 26% or US$8bn worth of Japan Post Holdings (6178 JP). In this note, we will talk about the updates and...

Sumeet Singh

Japan's Governance: Considerations for Bank Stocks

Although the bank sector is said to be highly lopsided, Metrical Score of the 72 banks is diversified. On the other hand, there is no significant...

Metrical Inc

HDB, MUFG Launch Bonds; Macro; Rating Changes; New Issues; Talking Heads; Top Gainers and Losers

US markets saw a sharp drop yesterday, continuing its volatile movement from last week – S&P and Nasdaq were down 1.3% and 2.4% respectively....

BondEvalue

Global Cyclical Value Sectors Improving -- Buying Financials and Energy Names: ING Groep, Many More

Continued rising rates is likely to support value Sectors moving forward (especially Financials and Energy), and it also typically indicates...

Vermilion Research

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