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.

Daniel Tabbush has been highly ranked by Asiamoney, Bloomberg and The Asset for his Asian bank analysis, which began more than 20 years ago, and making him the longest standing Head of Asian Bank research in Asia. Tabbush made his name analyzing banks in Thailand, highlighting bad loan risks for Thai banks before and after the Thai Financial Crisis of 1997.

He is known for extolling the unusual positives of Japan’s mega banks in 2005, and the risks likely to hit HSBC from its U.S. subprime loan operations, in 2006. More recently, when most were concerned with nearly all Western banks in late 2008, Tabbush highlighted the positive outlook for Standard Chartered Bank at that time.

He was Head of Asian Bank research for 10 years at the top rated CLSA, overseeing 10 analysts in Asia and coverage of approximately 80 banks. In this role, he spearheaded bank coverage in Japan and Australia. Tabbush was also responsible for research of HSBC and Standard Chartered Bank. Prior to this role, he was the Managing Director of CLSA Securities (Thailand) and its Head of Research. Daniel began his stock-broking career in Thailand in 1993 at Swiss Bank Corp, where his focus was on Thai Banks, after which he joined CLSA in 1996. Daniel grew up in Los Angeles, graduated from University of California, San Diego in Economics, cum laude and with Phi Beta Kappa honors. He lives with his wife and kids in Bangkok and he enjoys running, cooking and playing chess.

Since leaving the stock broking industry in 2012, he has run his Tabbush Report research and consultancy business.


Regulatory Information

  • Regulatory Status: Fifth Element Research & Consultancy Co Ltd is incorporated and registered with Financial Services Authority of Republic of Seychelles.
  • ID Number: Company number 185945

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Daniel Tabbush

China Banks - No corporate deleveraging, with high debt growth at weakest companies

It is a myth that China corporates are deleveraging. There is no indication of this from company data or from bank data. Rather, corporates are re-leveraging. Over the latest full year, total debt of China’s non-financial companies rose dramatically, by US$431 billion. This change is higher than any year in the past five and at 19% growth YoY, it far surpassed the previous three years. Our corporate data shows most growth was with the most distressed companies, those with debt/ebitda at >7x. This makes it important to understand that large banks are giving up corporate loan share, while small ...

Daniel Tabbush

Thai Banks - TISCO NIM expansion near best in Asia

The magnitude of Tisco Financial Group’s (TISCO) net interest margin (NIM) expansion is tremendous. Of 72 Asian banks, Tisco’s NIM expansion ranks third, at +108bps from 2015 to 1Q18. The figures are not flattered from being low, where its NIM is now 4.58%, one of the highest in Asia.

Daniel Tabbush

Philippine banks - PNB turnaround gathers momentum

The turnaround at Philippine National Bank (PNB) accelerates in 1Q18. Where the bank reinstated its dividend in 2016 it is still early days in its transformation. But 1Q18 data is reassuring. Net interest margins (NIM) rose to 3.44% in 1Q18 from 3.12% last year, and marks a directional change.

Daniel Tabbush

HDFC Bank - Surging credit costs may surprise some, but this may accelerate further

There is no major bank in Asia-Pacific that is growing loan as fast as HDFC Bank. Over the past two years, from FY16 to FY18, the bank expanded its gross loans from INR4,873 billion to INR7,000 billion. This 44% growth comes during a time of unprecedented weakness in the domestic economy, as evidenced by India’s banks having the highest non-performing loan (NPLs) ratios in the region. Average NPL ratios were 9.9% as at calendar year-end 2017 for India’s banks compared with 1-3% for others in Asia-Pacific. This does not include restructured loans, which as at the most recent fiscal year-end ave...

Daniel Tabbush

Krungthai Card - Unprecedented strength

 Krungthai Card PCL (KTC) was already one of Asia’s most profitable lenders during 2016 and 2017. With 1Q18 ROA at an unprecedented 6.7%, it makes historically high returns look paltry. This is despite recent Bank of Thailand (BOT) regulations implemented during September 2017, which lowered the maximum rate charged on credit cards from 20% to 18%.

Daniel Tabbush

Thai Banks - TISCO NIM expansion near best in Asia

The magnitude of Tisco Financial Group’s (TISCO) net interest margin (NIM) expansion is tremendous. Of 72 Asian banks, Tisco’s NIM expansion ranks third, at +108bps from 2015 to 1Q18. The figures are not flattered from being low, where its NIM is now 4.58%, one of the highest in Asia.

Daniel Tabbush

Philippine banks - PNB turnaround gathers momentum

The turnaround at Philippine National Bank (PNB) accelerates in 1Q18. Where the bank reinstated its dividend in 2016 it is still early days in its transformation. But 1Q18 data is reassuring. Net interest margins (NIM) rose to 3.44% in 1Q18 from 3.12% last year, and marks a directional change.

Daniel Tabbush

HDFC Bank - Surging credit costs may surprise some, but this may accelerate further

There is no major bank in Asia-Pacific that is growing loan as fast as HDFC Bank. Over the past two years, from FY16 to FY18, the bank expanded its gross loans from INR4,873 billion to INR7,000 billion. This 44% growth comes during a time of unprecedented weakness in the domestic economy, as evidenced by India’s banks having the highest non-performing loan (NPLs) ratios in the region. Average NPL ratios were 9.9% as at calendar year-end 2017 for India’s banks compared with 1-3% for others in Asia-Pacific. This does not include restructured loans, which as at the most recent fiscal year-end ave...

Daniel Tabbush

Krungthai Card - Unprecedented strength

 Krungthai Card PCL (KTC) was already one of Asia’s most profitable lenders during 2016 and 2017. With 1Q18 ROA at an unprecedented 6.7%, it makes historically high returns look paltry. This is despite recent Bank of Thailand (BOT) regulations implemented during September 2017, which lowered the maximum rate charged on credit cards from 20% to 18%.

Daniel Tabbush

Malaysia Building Society reveals best NPL improvements in Asean

Malaysia Building Society (MBSB) is one of Malaysia’s lesser-known financials and more of a specialized lender in personal loans. But major positive changes are happening. MBSB is showing some of the best improvements in credit metrics and returns of most any bank in Asean, let alone in Malaysia.  With MBSB’s recent acquisition of Asian Finance Bank (AFB), MBSB is moving forward. It will now transform itself to a full-fledged Islamic bank. Merger risks are now lessened and the bank completes its transformation by April 2018; when it marks its Islamic bank operational readiness and a full...

Daniel Tabbush

China Banks - No corporate deleveraging, with high debt growth at weakest companies

It is a myth that China corporates are deleveraging. There is no indication of this from company data or from bank data. Rather, corporates are re-leveraging. Over the latest full year, total debt of China’s non-financial companies rose dramatically, by US$431 billion. This change is higher than any year in the past five and at 19% growth YoY, it far surpassed the previous three years. Our corporate data shows most growth was with the most distressed companies, those with debt/ebitda at >7x. This makes it important to understand that large banks are giving up corporate loan share, while small ...

Australian banks - Stressing out

Australian bank stress-tests assume A$9bn of impairment costs, we believe A$66bn is more reasonable. ​Risks for Australia's banks are taking centre stage, even before the latest downgrade. There are signs at fringe financials of worsening consumer credit in 1H17. The large banks' own mortgage loan stress tests are sensible, but leave out the lumpy and real risk of corporate loan defaults. Frailty here is real. We prepare our own stress tests for the large four banks, on all assets, with dramatic results. For this, we use long-term perspective of impairment costs since 1990. On our scenarios pr...

China - Decoding the numbers

We examine signs of understated bad loans for China's banks, analysing banks' financial statements, but also over 2,300 Chinese companies. China bank impairment costs compared with peers in Asia, and long-term over many cycles, suggests there is still a long way to go. Worsening bank margins in China, are also a tell-tale sign of non-accrual loans; loans at below-market rates; and loans on interest rate grace periods.

U.S. Banks - Credit metrics turning down, rising rates will exacerbate

There are numerous signs of worsening credit metrics for U.S. banks, while corporate interest coverage is also especially weak for those at less than 1x. Impairment costs have accelerated dramatically for the past two years for U.S. banks, and rising rates will only make this worse. Interestingly, where most presume that rising rates will bring about a windfall in net interest income, we show how this is being offset by provision costs. 

Asian corporate financial analysis as a guide to bad loan risk

​We look at over 17,000 companies across each Asian country to understand relative financial health. Where most credit ratings agencies consider 6x debt/ebitda as worrisome and prone to default, there are several countries in Asia where this figure is far higher. Together with 15-20 year history of impairment costs, we can understand how much further impairment costs much rise or fall, when taking into account the health of the corporates. There are especially concerning findings for the distribution of debt held by the weakest companies in places like China and Singapore. 

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