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

Bendigo And Adelaide Bank / Equity Bottom-Up

<ul>
<li>In any economy with persistently high interest rates, high living costs and decelerating loan growth, the risk is generally greater for bad corporate loans, not mortgage loans. </li>
<li>BEN is nearly only residential mortgage loans, highly different to CBA, NAB, WBC, ANZ and MQG. This is also clear in long-term low levels of credit costs. </li>
<li>NIM has moved up for BEN in FY23. There is limited risk of maturing debt to hurt its NIM in FY24, very much unlike large peer banks, especially NAB, MQG. </li>
</ul>


In any economy with persistently high interest rates, high living costs and decelerating loan growth, the risk is generally greater for bad corporate loans, not mortgage loans. 
BEN is nearly only residential mortgage loans, highly different to CBA, NAB, WBC, ANZ and MQG. This is also clear in long-term low levels of credit costs. 
NIM has moved up for BEN in FY23. There is limited risk of maturing debt to hurt its NIM in FY24, very much unlike large peer banks, especially NAB, MQG. 


2024 High Conviction - BEN - Almost All Mortgages | NPLs in Decline | Credit Costs Can Move Lower

<ul>
<li>AMP released 1H23 numbers with 24-26% underlying NPAT growth in 2 key divisions</li>
<li>AUD610m of returned capital in past 12 months will see AUD140m added by October</li>
<li>AMP Bank is unlike peers, which is deposit-funded, small, focused on mortgages</li>
</ul>


AMP released 1H23 numbers with 24-26% underlying NPAT growth in 2 key divisions
AUD610m of returned capital in past 12 months will see AUD140m added by October
AMP Bank is unlike peers, which is deposit-funded, small, focused on mortgages


AMP - Strong Numbers Released,, Returning Capital, Paying Down Debt, Deposit Funded, Mortgage Bank

<ul>
<li>MQG is seeing far higher NPL growth than traditional bank peers</li>
<li>Funding costs pressure are far higher and NIM contraction is substantial</li>
<li>High rates for longer &amp; greater risks of recessionary-conditions can weight more on MQG</li>
</ul>


MQG is seeing far higher NPL growth than traditional bank peers
Funding costs pressure are far higher and NIM contraction is substantial
High rates for longer &amp; greater risks of recessionary-conditions can weight more on MQG


Australia Banks - MQG Funding Cost, NPLs Far Worse, With Higher Rates, Longer

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Australia & New Zealand Bankin / Event-Driven

<ul>
<li>This morning, ACCC <a href="https://www.accc.gov.au/media-release/accc-seeks-further-views-on-anzs-proposed-acquisition-of-suncorp-bank" target="_blank" rel="noopener">announced</a> that it had released a "<a href="https://www.accc.gov.au/system/files/public-registers/documents/Statement%20of%20preliminary%20views%20-%2004.04.23%20-%20PR%20-%20MA1000023%20ANZ%20Suncorp.pdf" target="_blank" rel="noopener">Statement of Preliminary Views</a>" on the ANZ/Suncorp deal and sought further views. </li>
<li>For now, the ACCC questions "the nature, likelihood, and extend of claimed public benefits" including synergies or claims regarding investment in Queensland. </li>
<li>Based on my reading of the document, this view is likely to carry over through the final decision due mid-June 2023. That means there's likely a trade here. </li>
</ul>


This morning, ACCC announced that it had released a "Statement of Preliminary Views" on the ANZ/Suncorp deal and sought further views. 
For now, the ACCC questions "the nature, likelihood, and extend of claimed public benefits" including synergies or claims regarding investment in Queensland. 
Based on my reading of the document, this view is likely to carry over through the final decision due mid-June 2023. That means there's likely a trade here. 


ACCC Sour on ANZ/Suncorp Bank Deal Makes for A Good Trade

Derivatives and Quantitative Strategist

Gaudenz Schneider

<ul>
<li>Australian banks’ November earnings triggered sharp and divergent share-price reactions, widening performance dispersion across the sector.</li>
<li>Based on the most recent moves, ANZ (ANZ AU) and Westpac (WBC AU) appear overvalued versus peers and potentially overbought, while two other banks screen as comparatively oversold.</li>
<li>Statistical analysis identifies sixteen actionable opportunities for quantitative traders targeting mean reversion plays within the sector.</li>
</ul>


Australian banks’ November earnings triggered sharp and divergent share-price reactions, widening performance dispersion across the sector.
Based on the most recent moves, ANZ (ANZ AU) and Westpac (WBC AU) appear overvalued versus peers and potentially overbought, while two other banks screen as comparatively oversold.
Statistical analysis identifies sixteen actionable opportunities for quantitative traders targeting mean reversion plays within the sector.


Relative Value in Australian Banks: ANZ/Westpac Overbought; Macquarie/Bendigo to Catch Up

Australia

National Australia Bank Limited is an international banking group which operates in Australia, New Zealand, Europe, Asia and the United States.  The Group offers banking services, credit and access card facilities, leasing, housing and general finance, international and investment banking, wealth and funds management, life insurance and custodian, trustee and nominee services.

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National Australia Bank (NAB AU)

2024 High Conviction - BEN - Almost All Mortgages | NPLs in Decline | Credit Costs Can Move Lower

BEN is unlike peers, with almost all mortgage loans, less of a problem with high rates, slowing economy. Its LT credit costs show this. NPLs are...

Daniel Tabbush

AMP - Strong Numbers Released,, Returning Capital, Paying Down Debt, Deposit Funded, Mortgage Bank

AMP is now launching an online bank, and this is a real concern. A the same time, its margin pressure at its AMP Bank is not strong, new guidance...

Daniel Tabbush

Australia Banks - MQG Funding Cost, NPLs Far Worse, With Higher Rates, Longer

MQG is not a traditional Australian bank, and where its NPL delta is far higher than peers, as its is funding cost delta. High rats for longer, may...

Daniel Tabbush

ACCC Sour on ANZ/Suncorp Bank Deal Makes for A Good Trade

The ACCC has come out pretty clearly against the ANZ/SunCorp Bank deal, and seems to prefer a deal where SunCorp Bank would be merged with another...

Travis Lundy

Relative Value in Australian Banks: ANZ/Westpac Overbought; Macquarie/Bendigo to Catch Up

Earnings in November led to varying share-price reactions, with ANZ and Westpac outperforming. Statistical analysis identifies sixteen...

Gaudenz Schneider

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