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)

<ul><li>There is no denying the slowing GDP growth in Indonesia.</li><li>The currency has become more acutely weak.</li><li>Bad loans are rising for all the major banks in 1Q15.</li><li>Without being flippant about the immediate risk to earnings from credit quality and the cycle, we believe that some perspective is worthwhile.</li></ul>

There is no denying the slowing GDP growth in Indonesia.The currency has become more acutely weak.Bad loans are rising for all the major banks in 1Q15.Without being flippant about the immediate risk to earnings from credit quality and the cycle, we believe that some perspective is worthwhile.

<ul><li>Philippine banks are now taking over others in SE Asia in terms of credit growth&nbsp;as they become more comfortable with their own financials and the overall economy.</li><li>Indonesian Bank loan growth has stepped down dramatically over the past few years. This reflects cyclically less corporate demand combined with increased caution from the banks</li><li>Thai Banks now report the lowest growth. With GDP growing at 0.5% this is reflective of demand.</li></ul>

Philippine banks are now taking over others in SE Asia in terms of credit growth&nbsp;as they become more comfortable with their own financials and the overall economy.Indonesian Bank loan growth has stepped down dramatically over the past few years. This reflects cyclically less corporate demand combined with increased caution from the banksThai Banks now report the lowest growth. With GDP growing at 0.5% this is reflective of demand.

South East Asian Loan Growth  - Phillippine, Thai and Indonesian Banks Compared.

Poor loan processing caused high NPLs, and this is now changing. &nbsp;As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x PB, BJBR is cheap vs peers, and with a high 10% dividend yield.

Poor loan processing caused high NPLs, and this is now changing. &nbsp;As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x PB, BJBR is cheap vs peers, and with a high 10% dividend yield.

A cheap Indonesian bank, with a 10% yield, where NPLs will decline fast. 

<ul><li>A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ &nbsp;combine to create a world of worry in markets and bank stocks in particular. The way this usually plays out is first with liquidity.&nbsp; </li><li>Banks pull credit lines from weaker banks (and weaker companies).&nbsp; </li><li>If a bank has a loan to deposit ratio (LDR) above 100%, it is often difficult to repay the redeemed credit line, as it means disposing of an asset, a loan – immediately. &nbsp; </li></ul>

A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ &nbsp;combine to create a world of worry in markets and bank stocks in particular. The way this usually plays out is first with liquidity.&nbsp; Banks pull credit lines from weaker banks (and weaker companies).&nbsp; If a bank has a loan to deposit ratio (LDR) above 100%, it is often difficult to repay the redeemed credit line, as it means disposing of an asset, a loan – immediately. &nbsp; 

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>Negara is our top pick in the Indonesian banks, based on our proprietary scorecard; it scores well based on attractive valuations, sound credit quality metrics and potential for improved returns</li>
<li>The PB value in Negara is especially apparent relative to Permata; Negara trades at a 50%+ PBV ratio discount to Permata, which we believe is not warranted by the fundamentals</li>
<li>We downgrade Mandiri from a buy to a neutral rating; it is no longer, in our view, compelling based on PBV ratio and now looks expensive in PEG ratio terms</li>
</ul>


Negara is our top pick in the Indonesian banks, based on our proprietary scorecard; it scores well based on attractive valuations, sound credit quality metrics and potential for improved returns
The PB value in Negara is especially apparent relative to Permata; Negara trades at a 50%+ PBV ratio discount to Permata, which we believe is not warranted by the fundamentals
We downgrade Mandiri from a buy to a neutral rating; it is no longer, in our view, compelling based on PBV ratio and now looks expensive in PEG ratio terms


Indonesian Banks; We Stick with Our Key Pick Bank Negara (BBNI IJ)

Indonesia

PT Bank Permata Tbk is a leading Indonesian commercial bank offering a comprehensive range of financial services, including retail and corporate banking products such as savings accounts, loans, credit cards, investments, and digital banking platforms. The bank provides solutions in conventional and Sharia-compliant formats, encompassing consumer banking, commercial banking, and wholesale banking segments. Headquartered in Jakarta, Indonesia, the company was founded in 1954.

Price Gauge
52-week Range	0.00 - 0.00
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Bank Permata (BNLI IJ)

Indonesia Concerns in Focus

There is no denying the slowing GDP growth in Indonesia. The currency has become more acutely weak. Bad loans are rising for all the major banks...

Daniel Tabbush

South East Asian Loan Growth - Phillippine, Thai and Indonesian Banks Compared.

Philippine banks are now taking over others in SE Asia in terms of credit growth as they become more comfortable with their own financials and the...

Daniel Tabbush

A cheap Indonesian bank, with a 10% yield, where NPLs will decline fast.

Poor loan processing caused high NPLs, and this is now changing. As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x...

Daniel Tabbush

Be Wary of High LDR Banks at Present

A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ combine to create a world of worry in markets and bank...

Daniel Tabbush

Indonesian Banks; We Stick with Our Key Pick Bank Negara (BBNI IJ)

We rank Indonesian banks based on our proprietary scorecard; Negara is top due to good value, credit quality, return potential and at a deep PBV...

Victor Galliano

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Indonesia Concerns in Focus

There is no denying the slowing GDP growth in Indonesia. The currency has become more acutely weak. Bad loans are rising for all the major banks...

Daniel Tabbush

South East Asian Loan Growth - Phillippine, Thai and Indonesian Banks Compared.

Philippine banks are now taking over others in SE Asia in terms of credit growth as they become more comfortable with their own financials and the...

Daniel Tabbush

A cheap Indonesian bank, with a 10% yield, where NPLs will decline fast.

Poor loan processing caused high NPLs, and this is now changing. As NPLs move from 4.5% of loans toward 3.0%, investors will be rewarded. At 1.2x...

Daniel Tabbush

Be Wary of High LDR Banks at Present

A likely Russian credit and currency crisis, the weakening Euro and ineptitude of BoJ combine to create a world of worry in markets and bank...

Daniel Tabbush

Indonesian Banks; We Stick with Our Key Pick Bank Negara (BBNI IJ)

We rank Indonesian banks based on our proprietary scorecard; ​Negara is top due to good value, credit quality, return potential and at a deep PBV...

Victor Galliano

We rank Indonesian banks based on our proprietary scorecard; Negara is top due to good value, credit quality, return potential and at a deep PBV...