That earlier sale plan “further begs the question of why UOB should lob a good S$360 million into the nationalized entity, said Daniel Tabbush,
an analyst who publishes on the Smartkarma research platform.
“UOB must find themselves in a difficult situation,” Tabbush added.
Bloomberg, Jan 10 2020 By Chanyaporn Chanjaroen
A typical annual package will include at least 10-15 Espresso notes, 6-12 Tabbush Reports, several hours of conference calls. Bespoke Research can be worked into package.
Member of Independent Research Forum (IRF)
Benign bad loan trends belie surging impairment costs
Many banks in Asia are seeing surging credit costs and despite more meagre growth in bad loans. This is also occurring with banks that have seen little in the way of new lending, including Japan. It is no longer enough to focus on bad loan formation when forecasting, understanding provision expenses.
Some may argue that this is due to new accounting regulation IFRS 9, which requires banks to take total expected credit losses (ECL) over the life of a bad loan.
Chailease is a proven, profitable leasing alternative to banks. It is a Taiwan-based multi-sector lease financing company, operating in Taiwan, China and Asean countries primarily.The company has a rich history of lease financing, beginning in 1977, with a proven track record of investing in specialized subsidiaries. The best evidence of the company’s ability to well manage its growing business is its rising ROA from 2.3% to 3.8%, from 2011 through the twelve months to 3Q18. Where Chailease impresses more is with ROE where it ranks 2nd highest in the region at 25.0%.
The tapestry of China bank malaise typically threads its way through corporate indebtedness, weak financial metrics and slowing economic growth.
We doubt there are many non-believers regarding risks facing corporate China and China’s banks. What may be less clear is how growth in city commercial bank NPLs is soaring, compared with more mainstream commercial banks, or that the distribution of NPLs is worsening toward more loss and doubtful loans.
It is easy to be lulled into a false sense of confidence with HSBC Holdings (HSBC). This is especially the case when looking at headline figures for impaired loans. Its reported problem loans are down
dramatically over the past several quarters. And yet despite this, its credit costs as a percentage of loans are driving higher. Figures were at a record low of 7bps in 1Q18 and rose to 35bps by 4Q18.
There have been many false dawns in India during the current economic malaise. The most obvious was when the government announced a recapitalization of banks. Others include election promises or revamping of debt resolution procedures.
But it should be clearer now that without a fundamental reduction in debt, or a change in loan underwriting standards or a meaningful, sustainable resumption of top line growth, bank credit metrics are only likely to weaken.
Singapore banks have revealed a sharp decline in their pass loans over the past two months. It is not something that most normally look at, but it is telling. The pace of decline is sharp and nearly on par with bank experience during late 2015. In 3Q19 the total level of pass loans compared with total loans is lower than most quarters since 1Q09.