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)

It is unclear which bank or NBFC will be next. <a href="https://www.smartkarma.com/entities/dewan-housing-finance-corp" target="_blank" data-smartkarma-citation="entities:8142:1" rel="noopener">Dewan Housing Finance (DEWH IN)</a> went bankrupt last year. IL&amp;FS went bankrupt the year before. This year we have <a href="https://www.smartkarma.com/entities/yes-bank-ltd" target="_blank" data-smartkarma-citation="entities:767:1" rel="noopener">Yes Bank (YES IN)</a> being nationalized or rescued or both, but effectively the same fate. It is unclear who will be next. Perhaps a bank or an NBFC which exaggerated credit growth during the past two years, with a limited amount of capital and with relatively high exposure to weak sectors? The collapse in oil prices is salt on India’s open wound - at least for lenders to oil companies with weakening financials.

It is unclear which bank or NBFC will be next. Dewan Housing Finance (DEWH IN) went bankrupt last year. IL&amp;FS went bankrupt the year before. This year we have Yes Bank (YES IN) being nationalized or rescued or both, but effectively the same fate. It is unclear who will be next. Perhaps a bank or an NBFC which exaggerated credit growth during the past two years, with a limited amount of capital and with relatively high exposure to weak sectors? The collapse in oil prices is salt on India’s open wound - at least for lenders to oil companies with weakening financials.

When bankers talk about loan seasoning, they are referring to when a loan is tried and tested in a downturn. Generally these are new loans done within the past two years, and may be termed unseasoned. The idea is that a real new loan will not likely default, as monies from the loan are available. But, where and as economic, business, personal conditions worsen, modeling shows that loan default rates rise sharply after two years, holding all else equal.  For India, we often focus on banks and NBFCs with sizable credit growth in recent years, for this very reason. We continue to believe that there is generally more risk with those banks with over-sized credit growth during the last two to three years, than banks that have kept credit growth constrained.

When bankers talk about loan seasoning, they are referring to when a loan is tried and tested in a downturn. Generally these are new loans done within the past two years, and may be termed unseasoned. The idea is that a real new loan will not likely default, as monies from the loan are available. But, where and as economic, business, personal conditions worsen, modeling shows that loan default rates rise sharply after two years, holding all else equal.  For India, we often focus on banks and NBFCs with sizable credit growth in recent years, for this very reason. We continue to believe that there is generally more risk with those banks with over-sized credit growth during the last two to three years, than banks that have kept credit growth constrained.

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

TSE Tokyo Price Index TOPIX / Technical Analysis

Our outlook for ex-U.S. markets (MSCI ACWI ex-U.S. index, local currency) remains neutral - bordering on cautious. Our concern stems from the recent pattern of lower highs and continued underperformance relative to MSCI ACWI - remain underweight.  Two bright spots: we are seeing bullish inflections in Japan (TOPIX and Nikkei 225), and India's SENSEX.  We unpack these, and also highlight actionable set ups in our global Communications, and Transportation Sectors.

Our outlook for ex-U.S. markets (MSCI ACWI ex-U.S. index, local currency) remains neutral - bordering on cautious. Our concern stems from the recent pattern of lower highs and continued underperformance relative to MSCI ACWI - remain underweight.  Two bright spots: we are seeing bullish inflections in Japan (TOPIX and Nikkei 225), and India's SENSEX.  We unpack these, and also highlight actionable set ups in our global Communications, and Transportation Sectors.

Global Equity Strategy: Opportunities in Japan and India

MSCI Emerging Markets Index / Technical Analysis

In this report we provide a synopsis of EM markets. We also scour the EM universe for attractive and actionable opportunities, highlighting opportunities within India's SENSEX, global energy and materials sectors, and Asian banks.

In this report we provide a synopsis of EM markets. We also scour the EM universe for attractive and actionable opportunities, highlighting opportunities within India's SENSEX, global energy and materials sectors, and Asian banks.

YTD sideways congestion for the MSCI ACWI ex-US and an intact downtrend for the MSCI EM index continue to point to a risk-off environment for international equity markets, and supports our neutral outlook. We continue to recommend avoiding broad indexed exposure in favor of selectivity. In today’s report we highlight actionable country- and Sector-specific themes within Norway, India, Japan and Australia.

YTD sideways congestion for the MSCI ACWI ex-US and an intact downtrend for the MSCI EM index continue to point to a risk-off environment for international equity markets, and supports our neutral outlook. We continue to recommend avoiding broad indexed exposure in favor of selectivity. In today’s report we highlight actionable country- and Sector-specific themes within Norway, India, Japan and Australia.

Global Ex-U.S. & EM Continue to Point to Risk-Off Environment

India

RBL Bank is an Indian private sector bank that provides a comprehensive range of banking and financial services to retail, corporate, and institutional customers. Its offerings include savings and current accounts, fixed deposits, credit cards, loans, investments, and digital banking solutions. The bank was founded in 1943 and is headquartered in Mumbai, India.

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RBL Bank (RBK IN)

India Banks – An Open Wound

It is unclear which bank or NBFC will be next. Dewan Housing Finance (DEWH IN) went bankrupt last year. IL&FS went bankrupt the year before....

Daniel Tabbush

India – Loan Seasoning

When bankers talk about loan seasoning, they are referring to when a loan is tried and tested in a downturn. Generally these are new loans done...

Daniel Tabbush

Global Equity Strategy: Opportunities in Japan and India

Our outlook for ex-U.S. markets (MSCI ACWI ex-U.S. index, local currency) remains neutral - bordering on cautious. Our concern stems from the...

Vermilion Research

EM Strategy: Remain Overweight India

In this report we provide a synopsis of EM markets. We also scour the EM universe for attractive and actionable opportunities, highlighting...

Vermilion Research

Global Ex-U.S. & EM Continue to Point to Risk-Off Environment

YTD sideways congestion for the MSCI ACWI ex-US and an intact downtrend for the MSCI EM index continue to point to a risk-off environment for...

Vermilion Research

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