Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Victor Galliano is an experienced equity banks analyst, having covered Latin America banks and non-bank financials for over 12 years, as well as more recently covering the Italian banks. He has worked in sell side equity research for 30 years in a career spanning Barclays, HSBC, BBVA LatInvest, Barings and NatWest.
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.

Financials & FinTech research

Banorte(GFNORTEO MM): Triple Hit in 4Q20 Lays the Foundation for Healthy Dividend Resumption in 2021

Mexican Banks YE 2020 Credit Quality Data Points; Banorte Screens Better than Peers

GEM Bank Credit Quality and Value Screens; the 4Q20 Story so Far

EM Banks: Screening for Value and Resilience

Mexican Banks Data for August Is Positive for Banorte (GFNORTEO MM)

Banorte (GFNORTEO MM): Prepared for the Next Wave…of NPLs

Gravity Works As WeWork Doesn't; Now Plan B

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

Grupo Financiero Banorte SAB d / Equity Bottom-Up

Grupo Financiero Banorte SAB d (GFNORTEO MF)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/grupo-financiero-banorte-o" target="_blank" data-smartkarma-citation="entities:24780:1" rel="noopener">Grupo Financiero Banorte-O (GFNORTEO MF)</a> announced that it is to boost loan loss provisions by MXN2bn in 4Q20 reflecting the heightened pandemic credit risks</li>
<li>We see this as a “kitchen sinking” of 2020 earnings via cost of risk charges, but this creates a base for earnings recovery into 2021 and 2022</li>
<li>The Mexican banks’ November data underscores the need for bolstering provisions among the big banks; BBVA Bancomer, <a href="https://www.smartkarma.com/entities/banco-santander-mexico-sa-in" target="_blank" data-smartkarma-citation="entities:27672:1" rel="noopener">Banco Santander Mexico-B (BSMXB MM)</a>, HSBC Mexico and CitiBanamex could all take a similar path to Banorte</li>
<li>We reiterate our positive view on Banorte, which screens well versus other EM banks on valuation and compares favourably in terms of credit quality and capital adequacy to its key Mexican peers</li>
<li>Risks to our positive Banorte view include worse than expected credit quality going forward, leading to higher credit charges, as well as soft loan growth and credit spread erosion</li>
</ul>



Grupo Financiero Banorte-O (GFNORTEO MF) announced that it is to boost loan loss provisions by MXN2bn in 4Q20 reflecting the heightened pandemic credit risks
We see this as a “kitchen sinking” of 2020 earnings via cost of risk charges, but this creates a base for earnings recovery into 2021 and 2022
The Mexican banks’ November data underscores the need for bolstering provisions among the big banks; BBVA Bancomer, Banco Santander Mexico-B (BSMXB MM), HSBC Mexico and CitiBanamex could all take a similar path to Banorte
We reiterate our positive view on Banorte, which screens well versus other EM banks on valuation and compares favourably in terms of credit quality and capital adequacy to its key Mexican peers
Risks to our positive Banorte view include worse than expected credit quality going forward, leading to higher credit charges, as well as soft loan growth and credit spread erosion


Banorte (GFNORTEO MF) To Boost Provisions; November Banks Data in Charts Reflects System’s Strength