Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

<ul>
<li>IndiaBulls reported FY 3Q22 results of INR 3.0 bn, improving INR 167 mn (5.8%) linked quarter; results were of poor quality; </li>
<li>Net new NPLs had increased INR 7.1 bn for the quarter for an annualized rate of increase of 139.6%; and </li>
<li>Given the continued break in credit, loss reserves appear light close to INR 28 bn – representing seven quarters of PBT and 17.1% of stated equity. </li>
</ul>


IndiaBulls reported FY 3Q22 results of INR 3.0 bn, improving INR 167 mn (5.8%) linked quarter; results were of poor quality; 
Net new NPLs had increased INR 7.1 bn for the quarter for an annualized rate of increase of 139.6%; and 
Given the continued break in credit, loss reserves appear light close to INR 28 bn – representing seven quarters of PBT and 17.1% of stated equity. 


IndiaBulls Housing Finance – Manufactured Bottom-Line

<ul>
<li>SBI results were highly managed in FY 2Q22, and going forward it’s difficult for anyone to take both these results and this bank very seriously; </li>
<li>SBI reported FY 3Q22 results of INR 84.3 bn, improving INR 8.1 bn (10.6%) linked quarter. Volatility between loss provisions and operating expenses continued; and </li>
<li>Net new NPLs accelerated 18.5% annualized, and SBI’s reserves are short INR 568 tn – over five quarters of pre-tax results. </li>
</ul>


SBI results were highly managed in FY 2Q22, and going forward it’s difficult for anyone to take both these results and this bank very seriously; 
SBI reported FY 3Q22 results of INR 84.3 bn, improving INR 8.1 bn (10.6%) linked quarter. Volatility between loss provisions and operating expenses continued; and 
Net new NPLs accelerated 18.5% annualized, and SBI’s reserves are short INR 568 tn – over five quarters of pre-tax results. 


State Bank of India – Rules Don’t Apply

Housing Development Finance Corporation / Equity Bottom-Up

Housing Development Finance Corporation (HDFC IN)

<ul>
<li>HDFC Ltd (HDFC.IN) [HDFC] reported FY 3Q22 results of INR 30.5 bn, decreasing INR 6.2 bn (16.9%) linked quarter basis reflecting a lack of dividends received; </li>
<li>Given the INR 4.2 bn in NCO during FY 3Q22, net new NPLs increased INR 11.7 bn or 23.3% on an annualized basis; and </li>
<li>We also find that HDFC’s reserve still needs shoring up by another INR 185 bn or over a year of PBT.   </li>
</ul>


HDFC Ltd (HDFC.IN) [HDFC] reported FY 3Q22 results of INR 30.5 bn, decreasing INR 6.2 bn (16.9%) linked quarter basis reflecting a lack of dividends received; 
Given the INR 4.2 bn in NCO during FY 3Q22, net new NPLs increased INR 11.7 bn or 23.3% on an annualized basis; and 
We also find that HDFC’s reserve still needs shoring up by another INR 185 bn or over a year of PBT.   


<ul>
<li>IndusInd reported FY 3Q22 bottom-line results improved 4.8% linked quarter, driven by stronger core revenues and a lower provision; </li>
<li>NCOs remain elevated and show no sign of abating, and net new NPLs increased 31.6% annualized; and </li>
<li>IndusInd’s reserve needs to increase closer to 75% with a shortfall of INR 30 bn – representing two quarters of pre-tax results. </li>
</ul>


IndusInd reported FY 3Q22 bottom-line results improved 4.8% linked quarter, driven by stronger core revenues and a lower provision; 
NCOs remain elevated and show no sign of abating, and net new NPLs increased 31.6% annualized; and 
IndusInd’s reserve needs to increase closer to 75% with a shortfall of INR 30 bn – representing two quarters of pre-tax results. 


<ul>
<li>ICICI reported FY 3Q22 earnings of INR 61.9 bn, increasing INR 6.8 bn (12.4%) linked quarter, driven by net interest and fee improvement and a provision cut;  </li>
<li>Net new NPLs continued to increase 11.4% on an annualized basis at FY 3Q22 versus INR 44.1 bn 43.7% at FY 3Q21; and    </li>
<li>We find that ICICI is short on reserves to the tune of INR 116 bn or just over a half year of ICICI’s core operating result. </li>
</ul>


ICICI reported FY 3Q22 earnings of INR 61.9 bn, increasing INR 6.8 bn (12.4%) linked quarter, driven by net interest and fee improvement and a provision cut;  
Net new NPLs continued to increase 11.4% on an annualized basis at FY 3Q22 versus INR 44.1 bn 43.7% at FY 3Q21; and    
We find that ICICI is short on reserves to the tune of INR 116 bn or just over a half year of ICICI’s core operating result. 


India

Union Bank of India Limited provides a full range of banking services throughout India. The Company's activities include retail banking, commercial and personal banking, investment management, treasury and NRI services, cash management and assorted ATM facilities. Union Bank has an online tele-banking facility for all its core banking customers.

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Union Bank Of India (UNBK IN)

IndiaBulls Housing Finance – Manufactured Bottom-Line

I-BULLS: IndiaBulls reported a poor quality QOQ FY 3Q22 results increase of 5.8%.Net new NPLs increased at 139.6% annualized, while loss reserves...

Thomas J. Monaco

State Bank of India – Rules Don’t Apply

SBI: It’s difficult for anyone to take this bank very seriously. SBI reported a QOQ FY 3Q22 results increase of 10.6%, as volatility between loss...

Thomas J. Monaco

HDFC Ltd. – Lack of Conservatism

HDFC: HDFC reported FY 3Q22 results decline of 16.9% QOQ. Net new NPLs increased 23.3% on an annualized basis, and HDFC’s reserve still needs...

Thomas J. Monaco

IndusInd Bank – Stabilizing Somewhat

INDUSIND BANK: IndusInd reported FY 3Q22 bottom-line results improvement of 4.8% linked quarter, driven by stronger core revenues. NCOs remain...

Thomas J. Monaco

ICICI Bank – Continued Improvement

ICICI BANK: ICICI FY 3Q22 earnings increased 12.4% QOQ driven by net interest income and fee improvement and a provision cut. ICICI is still short...

Thomas J. Monaco

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