Asian bank research and consultancy, Tabbush Report

Daniel Tabbush

Asian bank 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>HFD for US small banks shows USD2.6bn new CRE loans in week vs USD3.4bn new total loans</li>
<li>US small banks have CRE loans at 2.9x capital vs 2.5x in recent periods and less provisions</li>
<li>Large term deposits are up from 8.5% to 14.2% of loans from trough to most recent week </li>
</ul>


HFD for US small banks shows USD2.6bn new CRE loans in week vs USD3.4bn new total loans
US small banks have CRE loans at 2.9x capital vs 2.5x in recent periods and less provisions
Large term deposits are up from 8.5% to 14.2% of loans from trough to most recent week 


US Small Banks - New HFD Shows 76% of New Loans Are CRE in Recent Week | CRE Loans at 2.9x Capital

While economic recovery data may be clearest, we look to US banks’ C19 loan modifications. Most banks globally term these loans as deferral loans, and they are a new feature of banks’ balance sheets from the government actions taken early in this year. Modified loans or reschedule loans have narrowed dramatically in the most recent quarter, suggesting that the degree of stress is not worsening, and quite the contrary.

While economic recovery data may be clearest, we look to US banks’ C19 loan modifications. Most banks globally term these loans as deferral loans, and they are a new feature of banks’ balance sheets from the government actions taken early in this year. Modified loans or reschedule loans have narrowed dramatically in the most recent quarter, suggesting that the degree of stress is not worsening, and quite the contrary.

AlphaSituations-Event/Catalyst Driven Research, AlphaSituations

Robert Sassoon

AlphaSituations-Event/Catalyst Driven Research

AlphaSituations

Since its establishment, AlphaSituations has delivered a track record of outperformance with a hit rate of winners of more than 70% of its portfolio of ideas generating annualized average returns of 20%. In January 2022, AlphaSituations was contracted by Water Tower Research, an investor engagement and stakeholder communication platform to provide coverage of Special Situations

Our snapshot study reveals that abandoned merger targets can deliver even more lucrative investment opportunities once the dust settles. Based on data from our universe of announced US M&amp;A deals in excess of $400MN going back to 2017, when merger transaction terminations do occur (which is not that common), better returns can be achieved out of target companies more often than not.

Our snapshot study reveals that abandoned merger targets can deliver even more lucrative investment opportunities once the dust settles. Based on data from our universe of announced US M&amp;A deals in excess of $400MN going back to 2017, when merger transaction terminations do occur (which is not that common), better returns can be achieved out of target companies more often than not.

MergerTalk:Broken Deals Do Not Necessarily Lead To Broken Investments

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

In last Tuesday’s Compass (10/27/20) we noted the S&amp;P 500’s break below 3425 short-term support opened the door for potential visits to 3325 and 3200. Support at 3325 was violated by Wednesday, however the 3200-3230 level has held and remains important support moving forward.  In today’s report we highlight attractive Groups and stocks within Financials: Asian Banks, Puerto Rican Banks, Banks, Southwest, and Investment Banking &amp; Brokerage, Mid-Cap

In last Tuesday’s Compass (10/27/20) we noted the S&amp;P 500’s break below 3425 short-term support opened the door for potential visits to 3325 and 3200. Support at 3325 was violated by Wednesday, however the 3200-3230 level has held and remains important support moving forward.  In today’s report we highlight attractive Groups and stocks within Financials: Asian Banks, Puerto Rican Banks, Banks, Southwest, and Investment Banking &amp; Brokerage, Mid-Cap

U.S. Equity Strategy: Markets Bouncing off Key Support

We must expect some degree of higher NPL formation at banks in Texas due to lower oil prices. But in the current environment that will be compounded with more traditional credit stresses from the shutdown; many Banks in Texas  have a high level of CRE loans. We look at how banks fare with recent credit growth, with the concern that some have grown incredibly fast into the downturn. While the Texas Ratio may be good at identifying which banks have more capital and provisions compared with impaired and loan loans, we feel it can also lag; credit growth can be a better lead indicator of future stresses.

We must expect some degree of higher NPL formation at banks in Texas due to lower oil prices. But in the current environment that will be compounded with more traditional credit stresses from the shutdown; many Banks in Texas  have a high level of CRE loans. We look at how banks fare with recent credit growth, with the concern that some have grown incredibly fast into the downturn. While the Texas Ratio may be good at identifying which banks have more capital and provisions compared with impaired and loan loans, we feel it can also lag; credit growth can be a better lead indicator of future stresses.

United States

Texas Capital Bancshares, Inc. is the holding company for Texas Capital Bank, NA.  The Bank attracts deposits from the general public and invests those funds in loans secured by single-family residential loans and commercial real estate, secured and unsecured commercial loans, and consumer loans.  The Bank's current primary market is the greater Dallas/Fort Worth metropolitan area.

Texas Capital Bancshares (TCBI US)

US Small Banks - New HFD Shows 76% of New Loans Are CRE in Recent Week | CRE Loans at 2.9x Capital

New HFD shows new CRE loans at 76% of total new loans, for small US banks. Their CRE loans/capital is rising and LLR/CRE loans is low, falling. Off...

Daniel Tabbush

US Banks – Deferral Debt Dwindling

We look to US banks’ C19 loan modifications. Modified loans or reschedule loans have narrowed dramatically, suggesting that the degree of stress is...

Daniel Tabbush

MergerTalk:Broken Deals Do Not Necessarily Lead To Broken Investments

Our snapshot study reveals that abandoned merger targets can deliver even more lucrative investment opportunities more often than one might think

Robert Sassoon

U.S. Equity Strategy: Markets Bouncing off Key Support

In today’s report we highlight attractive Groups and stocks within Financials: Asian Banks, Puerto Rican banks, Banks, Southwest, and Investment...

Vermilion Research

Texas Banks – Oversized Loan Growth

We must expect some degree of higher NPL formation at banks in Texas due to lower oil prices. But in the current environment that will be...

Daniel Tabbush