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>New data for US PMI shows a continued weak economy, which is not positive for bank lending prospects or for loan pricing. It is also not positive for credit metrics. </li>
<li>New weekly data for large US banks show risk aversion remains, with rising cash, but also dismal growth in loans at only 0.5% YoY in the most recent week. </li>
<li>Large time deposits continue to rise substantially at +110% YoY in most recent week, with cash rising too - the outlook for core net interest income is worsening.</li>
</ul>


New data for US PMI shows a continued weak economy, which is not positive for bank lending prospects or for loan pricing. It is also not positive for credit metrics. 
New weekly data for large US banks show risk aversion remains, with rising cash, but also dismal growth in loans at only 0.5% YoY in the most recent week. 
Large time deposits continue to rise substantially at +110% YoY in most recent week, with cash rising too - the outlook for core net interest income is worsening.


US Banks - Weekly Balance Sheets Show Risk Aversion Remains, New PMI Data Continues to Be Weak

<ul>
<li>There was one week of data where large US banks showed -0.1% YoY growth in commercial and industrial (C&amp;I) but the most recent week is -1.0% so more solidly negative.</li>
<li>Cash balances continue to show YoY growth at double digit, now at 18.4% suggesting limited demand, and still banks having risk-aversion.</li>
<li>Jumbo time deposit growth remains extraordinary at 118% YoY in most recent week, and this money is more expensive than other time deposits.</li>
</ul>


There was one week of data where large US banks showed -0.1% YoY growth in commercial and industrial (C&amp;I) but the most recent week is -1.0% so more solidly negative.
Cash balances continue to show YoY growth at double digit, now at 18.4% suggesting limited demand, and still banks having risk-aversion.
Jumbo time deposit growth remains extraordinary at 118% YoY in most recent week, and this money is more expensive than other time deposits.


US Banks - Weekly Balance Sheets, Negative C&I Growth, Nearly First Time This Year, Other Negatives

<ul>
<li>New weekly balance sheets for US large banks shows C&amp;I loan growth turning negative. De-risking continues with cash balances up 15.1% YoY, the fourth week of double digit growth. </li>
<li>Total loan growth is nearly negative with the most recent week's release showing further slowing to 1.11% YoY in week to18 October. </li>
<li>With all of this, US large banks are accelerating their more expensive jumbo time deposits, with growth now at 115% YoY and adding USD26bn in the week. </li>
</ul>


New weekly balance sheets for US large banks shows C&amp;I loan growth turning negative. De-risking continues with cash balances up 15.1% YoY, the fourth week of double digit growth. 
Total loan growth is nearly negative with the most recent week's release showing further slowing to 1.11% YoY in week to18 October. 
With all of this, US large banks are accelerating their more expensive jumbo time deposits, with growth now at 115% YoY and adding USD26bn in the week. 


US Banks - New Weekly Balance Sheets: C&I Loan Growth Turns Negative | Cash +15% | All Loans +1%

<ul>
<li>Weekly mortgage loan applications index in the US is declining rapidly as is the weekly mortgage loan volume index. This gives a good forward view of growth.</li>
<li>Mortgage loans remain one of the most important segments for US banks at 23% of loans in the most recent week, so their decelerating growth is meaningful.</li>
<li>Given the high level of 30-year mortgage rates - not moving lower fast - decelerating mortgage loan growth should continue, and is likely to turn negative soon.</li>
</ul>


Weekly mortgage loan applications index in the US is declining rapidly as is the weekly mortgage loan volume index. This gives a good forward view of growth.
Mortgage loans remain one of the most important segments for US banks at 23% of loans in the most recent week, so their decelerating growth is meaningful.
Given the high level of 30-year mortgage rates - not moving lower fast - decelerating mortgage loan growth should continue, and is likely to turn negative soon.


US Banks - Mtg Loan Applications Index -15% from July | Mtg Loans 23% of Total | Growth Can Turn -Ve

<ul>
<li>US large banks are showing more cash emphasis in the latest weekly data, increased signs of risk aversion, with MBS in sharp decline and CRE loans</li>
<li>Loan loss reserves continue to rise at over 18% YoY, and this will mean that banks are taking a lot more credit costs, impacting returns, net profit growth</li>
<li>Large time deposits accelerating, up 88.0% YoY in the most recent week; with all of these points, perhaps it is no wonder that shareholders' equity is stagnant?</li>
</ul>


US large banks are showing more cash emphasis in the latest weekly data, increased signs of risk aversion, with MBS in sharp decline and CRE loans
Loan loss reserves continue to rise at over 18% YoY, and this will mean that banks are taking a lot more credit costs, impacting returns, net profit growth
Large time deposits accelerating, up 88.0% YoY in the most recent week; with all of these points, perhaps it is no wonder that shareholders' equity is stagnant?


US Large Banks - New B/S Data: CRE Craters, MBS Sharp Decline, LLR & Big Fixed Deposits Up+, SE Flat

United States

Remitly Global Inc provides financial services. The Company offers online money transer and payment solutions. Remitly Global serves customers worldwide.

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Remitly Global (RELY US)

US Banks - Weekly Balance Sheets Show Risk Aversion Remains, New PMI Data Continues to Be Weak

New high frequency data on US large banks show weekly loan growth remains weak, large time deposit growth is high, and cash is rising. New PMI data...

Daniel Tabbush

US Banks - Weekly Balance Sheets, Negative C&I Growth, Nearly First Time This Year, Other Negatives

US large banks show -1.0% YoY growth in C&I loans in the most recent weekly release. Cash balances are still rising a lot as are jumbo time...

Daniel Tabbush

US Banks - New Weekly Balance Sheets: C&I Loan Growth Turns Negative | Cash +15% | All Loans +1%

New weekly balance sheet data gives near real-time view. C&I loans just turned negative. Cash is growing fast, total loans nearly negative. Large...

Daniel Tabbush

US Banks - Mtg Loan Applications Index -15% from July | Mtg Loans 23% of Total | Growth Can Turn -Ve

HFD in the US shows worsening weekly data for mortgage loan applications and for mortgage loan volume. Growth is decelerating fast and it can turn...

Daniel Tabbush

US Large Banks - New B/S Data: CRE Craters, MBS Sharp Decline, LLR & Big Fixed Deposits Up+, SE Flat

HFD shows risk aversion increasing at large US banks. LLR rising a lot and big fixed time deposits, can mean worsening net profit delta. With less...

Daniel Tabbush

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