Author Topic: Banks  (Read 25525 times)

Offline zuolun

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« on: June 06, 2016, 02:58:31 PM »
Malaysian banks' NIMs to contract further by 5% to 10% ~ 6 Jun 2016

Malaysian banking industry showing trend of weakness ~ 2 Jun 2016

Fitch affirms major Singapore banks at 'AA-'; outlook stable ~ 1 Jun 2016

Singapore crackdown signals cost jump for Asia private banks ~ 1 Jun 2016

The Malaysian equivalent of Singapore’s companies

By Lawrence Nga
26 May 2016

There are many similarities between Singapore and Malaysia. The peoples of both countries enjoy similar foods, have a similar culture, and also speak similar languages.

That’s not all. The stock markets of both countries also contain companies that have similar businesses.

For instance, there’s banking. In the Singapore market, there are three banks, namely, DBS Group Holdings Ltd (SGX: D05), Oversea-Chinese Banking Corp Limited (SGX: O39), and United Overseas Bank Ltd (SGX: U11).

In Malaysia, there are more banks. Here are some of the bigger ones: Malayan Banking Berhad (KLSE: 1155.KL), CIMB Group Holdings Bhd (KLSE: 1023.KL), and Public Bank Berhad (KLSE: 1295.KL).

Plantation companies are also present in both Singapore and Malaysia’s stock market.

In Singapore, some of the plantation companies include palm oil producers such as Wilmar International Limited (SGX: F34), Golden Agri-Resources Ltd (SGX: E5H), First Resources Ltd (SGX: EB5), and Indofood Agri Resources Ltd (SGX: 5JS). There are more.

In Malaysia, we can find major players such as Sime Darby Berhad (KLSE: 4197.KL), IOI Corporation Bhd (KLSE: 1961.KL), and Kuala Lumpur Kepong Berhad (KLSE: 2445.KL).

How about the oil and gas sector?

Oil and gas companies are plentiful in Singapore’s stock market. Major players include Sembcorp Marine Ltd (SGX: S51) – subsidiary of SembCorp Industries Limited (SGX: U96) – and Keppel Corporation Limited (SGX: BN4). In Malaysia, there are also big oil & gas companies such as Sapurakencana Petroleum Bhd (KLSE: 5218.KL).

When it comes to investing, it may make sense to expand our horizons beyond Singapore and look at other countries in order to give us more options.

Deutsche Bank (DB) ratings cut by Moody's; outlook stable ~ 26 May 2016

Here's why fixing Deutsche Bank is one of the toughest jobs in banking ~ 25 May 2016

Deutsche Bank trading woes exposed in slide down currency league ~ 25 May 2016

Q&A: How scandal in Malaysia hit a Swiss private bank ~ 24 May 2016

May 2016: Will Deutsche Bank survive this wave of trouble? ~ 23 May 2016

Deutsche bank's $11 million men deserve to be scrutinized ~ 19 May 2016

A better bank stock: CIMB Group Holdings Bhd vs. Singapore’s big banking trio

By Chong Ser Jing
December 10, 2015

Singapore’s stock market does not offer much choice for investors when it comes to banks – there are only three banking stocks listed here, namely, DBS Group Holdings Ltd (SGX: D05), Oversea-Chinese Banking Corp Limited (SGX: O39), and United Overseas Bank Ltd (SGX: U11).

As such, it may make sense for Singapore investors to peer across the Causeway and take a look at Malaysia’s stock market. With nearly 1,800 companies there as opposed to the 771 stocks available in Singapore, a look into Malaysia, a country with close links to and plenty of shared history with Singapore, could help broaden the opportunity set for investors here.

With this in mind, how might CIMB Group Holdings Bhd (KLSE: 1023.KL), Malaysia’s second largest financial institution, stack up against Singapore’s banking trio from an investor’s point of view?

CIMB is certainly going up against tough competition. Singapore’s banks are strong, so much so that they were still solidly profitable even during the global financial crisis of 2007/09, a period when many Western banks collapsed with even more on the brink of getting wiped out.

There are a number of important financial metrics that tell us how strong a bank’s business is. But in here, let’s look at three in particular: the loan-to-deposit ratio; the efficiency ratio; and the growth in book value per share.

Loan-to-deposit ratio

The business of banking is simple when boiled down to the basics: A bank takes in deposits and loans that capital to individuals and/or organizations. But, this simple act of borrowing money (taking in deposits) and then loaning it out can result in liquidity issues if not handled prudently.

Deposits can be withdrawn at short notice. But loans that a bank has given out, which have maturities that range from a few months to a few decades (housing loans are a great example of the latter), can’t be recalled as quickly. This creates what’s called a duration mismatch.

If a large group of depositors start asking for their deposits back from a bank within a narrow span of time for whatever reason, the duration mismatch comes to the forefront, causing the bank to potentially suffer from liquidity issues.

The loan-to-deposit ratio gives investors an idea of how much liquidity a bank has. Mathematically, it’s given as such:

Loan-to-deposit ratio = Total loans / Total deposits

With a high loan-to-deposit ratio, a bank will have a lower margin of safety in its ability to meet large withdrawals or other emergencies. The table below illustrates how the loan-to-deposit ratios for DBS, OCBC, UOB, and CIMB have looked like over the last few years:

CIMB, with its average loan-to-deposit ratio of 88% over the period under study, has lost out to the banking trio of DBS, OCBC, and UOB from Singapore.

Efficiency ratio

The efficiency ratio measures a bank’s non-interest expenses as a percentage of its revenue. Generally, the lower the ratio, the better it is. The math works as such:

Efficiency ratio = Non-interest Expenses / Net Revenue

This ratio is crucial because it is a good proxy for the amount of risk that a bank is, quite literally, forced to take on in order to generate a decent profit. Charles Calomiris, a professor at the Columbia Business School, explains in his book Fragile by Design:

“Given an environment in which risk-taking with borrowed money was considered normal, it is easy to understand why some bankers, particularly those who were having trouble competing against more efficient rivals, decided that the right strategy was to throw caution to the wind [emphases mine].”

You can see how the efficiency ratios of the four banks we’re looking at have changed over their past five fiscal years:

In here, we can see that Singapore’s representatives, with their average efficiency ratios of less than 50%, have come out tops again against CIMB.

Growth in book value per share

A good rule of thumb for changes in a bank’s real economic worth is the growth in its book value per share. The math needed is shown below:

Book value per share = (Total Assets – Total Liabilities – Minority Interest) / Number of shares outstanding

Fast growth in a bank’s book value per share would indicate that it is adept at building value for shareholders. But, a bank with abnormally high growth rates would need to be approached with caution. That’s because the bank may be piling on risks and thus expose shareholders to potential losses should those risks blow up.

Growth is where CIMB manages to shine. From 2010 to 2014, Malaysia’s second-largest financial services provider has seen its book value grow by a healthy 10.1% per year. This compares very favourably against the growth rates of 8.1% or less that have been delivered by DBS, OCBC, and UOB.

A Fool’s take

In a final tally of the scores, we can see that DBS, OCBC, and UOB have collectively fared better than CIMB in two of the three categories. It’s worth noting though, that none of the above should be taken as the final word on the investing merits of the four bank stocks.

The numbers we’ve pored over are useful, but banks are notoriously complex businesses for investors to analyse and a deeper look is required before any investing decision can be reached.

Offline zuolun

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Re: Banks
« Reply #1 on: June 06, 2016, 03:11:24 PM »
Deutsche bank customers debited twice in as many days ~ 3 Jun 2016

Offline zuolun

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Re: Banks
« Reply #2 on: June 06, 2016, 04:53:52 PM »
Public bank sees strong growth in Cambodia ~ 5 Jun 2016

Lower bank earnings, AllianceDBS has reiterated “buy” calls on Public Bank and HL Bank ~ 3 Jun 2016

The three numbers that bolster CIMB Group Holdings Berhad

By David Kuo
30 May 2016

Malaysia has more than its fair share of banks. CIMB Group Holdings Berhad (1023.KL; KLSE: CIMB), whose history can be traced back to Kuching in 1924, is its many financial institutions.

CIMB, which is an abbreviation of Commerce International Merchant Banks, is one of the world’s largest Islamic banks. Last year, it reported a Return on Equity (RoE) of 6.7%, which was below those of peers Malayan Banking Berhad (1155.KL; KLSE: MAYBANK) and Public Bank Berhad (1295.KL; KLSE: PBBANK).

The lower RoE can be traced to a modest Net Income Margin of 21.7%. It means that CIMB only generated MYR21.70 of bottom-line profit on every MYR100 of sales. By comparison, Malayan Banking Berhad Net Income Margin was 35.5%.

CIMB’s Asset Turnover was not too dissimilar to its peers, though. It generated MYR2.90 of revenues on every MYR100 of assets at its disposal. Its Asset Turnover is also in line with Singapore banks, which include DBS Group (SGX: D05), UOB (SGX: U11) and OCBC (SGX: O39).

In common with other banks, CIMB makes use of leverage. That is, after all, how a bank makes money. Its Leverage Ratio was 10.9.

By dismantling CIMB’s Return on Equity, it is easier to understand what is going on at the company. Its RoE of 6.7% is the product of a modest Net Income Margin of 21.7%; a low Asset Turnover of 0.029 and a decent amount of Leverage Ratio of 10.8.

Downside risks persist for CIMB, says Maybank IB Research ~ 27 May 2016

Malaysia Maybank's quarterly profit falls 16% on higher provisions ~ 27 May 2016

Moody's: Outlook for Malaysian banks stable but headwinds ahead ~ 26 May 2016

RHB Cap Q1 profit up 16% ~ 26 May 2016

Hong Leong Bank Q3 net profit fell 4.11% to RM497.83 million ~ 25 May 2016

Offline zuolun

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Re: Banks
« Reply #3 on: June 30, 2016, 04:17:08 PM »
Maybank (1155) ~ Trading below the 200d SMA, downside bias

Maybank closed with a black marubozu @ RM8.12 (-0.07, -0.9%) with 4.87m shares done on 29 Jun 2016.

Immediate support @ RM8.05, immediate resistance @ RM8.30.

Brexit seen to have negative impact on banking sector

28 Jun 2016

Maintain neutral: Regional markets last Friday fell in reaction to the result of the European Union (EU) referendum in the UK. The official result was announced with the Brexit camp garnering 51.9% of total votes against 48.1% that voted for UK to remain in EU. With the local market taking cue from Wall Street, the financial market was impacted by the final result of the EU referendum, hence deeper value emerged for some of the local banking stocks, which already traded well below the average rolling forward price-to-book (PB) ratio.

Our view is that the result of the Brexit will have a negative impact on the banking sector in the near term due to weaker sentiment. Nevertheless, on fundamental basis, we view that Brexit will have a minimal impact on our local economy. This is in view that the significance of the bilateral trade between Malaysia and UK has declined. Year to date, UK contributed only 1.1% to Malaysia’s total trade and was ranked 17th out of 240 trading partners.

Hence, we see trading opportunities for stocks, which are trading between one and two standard deviation (SD) below average PB ratio as well as stock trading close to two SD below the average PB ratio as attractive for investment from the valuation perspective. Result of Brexit added deeper value for some banks after the drop in foreign shareholdings seen in May 2016.

Based on our observation, foreign shareholdings of most banks slipped in May 2016 after rising in February, March and April. This was based on Malayan Banking Bhd (Maybank), CIMB Group Holdings Bhd, RHB Capital Bhd, Alliance Financial Group Bhd and Affin Holdings Bhd, which provide more frequent updates on their foreign shareholdings. The other banks, AMMB Holdings Bhd, Hong Leong Bank Bhd and Public Bank Bhd provide their foreign shareholdings data on a quarterly basis.

Based on our observation, there was a drop in CIMB’s foreign shareholdings from 29% as at end-April 2016 to 27.7% as at end-May 2016. Meanwhile, Maybank’s foreign shareholdings declined from 18.8% on April 29, 2016 to 18% on May 27, 2016. We believe that this was contributed by the reduced weightage in MSCI of Malaysia stocks in the index to 3.09% from 3.43%, consequently reducing the weightage in Maybank and CIMB.

Prior to 2013, major central banks around the world that implemented stimulus packages, including the biggest monetary source from the US, through quantitative easing (QE) had caused an inflow of liquidity into emerging markets. Towards mid-2013, the impending rollback of the QE caused foreign funds to start to exit from equity markets in Asia. Since then, foreign shareholdings in local banks have fallen from the peak levels. — MIDF Research, June 27

Offline zuolun

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Re: Banks
« Reply #4 on: June 30, 2016, 05:45:53 PM »
Public Mutual declares RM141m distributions for 14 funds ~ 30 Jun 2016

Opportunity in best bank stock in Malaysia – Public Bank ~ 16 May 2016

Public Bank Berhad ~ 9 Dec 2015

Only in Malaysia - Tan Sri Teh Public Bank 45th epic anniversary birthday celebration ~ 18 Aug 2011

K'naan - Wavin' Flag (2010 FIFA World Cup South Africa)

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Re: Banks
« Reply #5 on: July 07, 2016, 10:56:56 AM »
Italy may spur Pan-Europe bank crisis, SocGen chairman says ~ 6 Jul 2016

European stocks slammed after property fund suspensions ~ 5 Jul 2016

Chart of the Day - US Dollar ~ 5 Jul 2016

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Re: Banks
« Reply #6 on: July 07, 2016, 07:49:13 PM »

Gundlach: "When Deutsche Bank Goes To Single Digits People Will Start To Panic"

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by Tyler Durden
Jul 7, 2016 4:55 AM
Following today's Fed minutes release, Jeff Gundlach had a far less "uncertain" message: “Things are shaky and feeling dangerous,” Gundlach told Reuters in a telephone interview.

It's not just stocks that Gundlach was not too excited about, he also had some choice words about buying Treasuries here. "You're seeing people who hated the '2 percent' 10-year suddenly loving it at a 1.38-1.39 percent revisit of the all-time low closing yield," Gundlach said. "If you buy 10-year Treasuries now, I would say, it is a terrible trade location. In fact, it is the worst trade location in the history of the 10-year Treasury."

True, just like buying stocks less than 2% from all time highs, however what Gundlach failed to mention is that those who are buying Treasurys here are not doing it for the yield (or lack thereof on more than $11 trillion in notional), they are simply doing so to frontrun even more central bank purchases now that the monetary spigots have once again been activated as "confused" central banks around the world have just one trick left up their sleeve - to monetize even more debt in hopes of pushing every last investor into risk assets.

The DoubleLine bond king also had some choice words about Europe's banking crisis: "Banks are dying and policymakers don’t know what to do," Gundlach said. "Watch Deutsche Bank shares go to single digits and people will start to panic... you'll see someone say, 'Someone is going to have to do something'."

So Gundlach hates equities and bonds; what does he like? According to Reuters' Jennifer Ablan, Gundlach said that "gold remains the best investment amid fears of instability in the European Union and prolonged global stagnation, as well as concerns over the effectiveness of central bank policies."

Gundlach, a staunch supporter of the precious metal, sees gold rising to $1400 an ounce this year.

"I am not selling gold.

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Re: Banks
« Reply #7 on: July 07, 2016, 07:55:58 PM »

A Furious Italian Prime Minister Slams Deutsche Bank As Europe's Most Insolvent Bank

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by Tyler Durden
Jul 6, 2016 10:30 PM
Several years ago, we were the first to point out the true "elephant in the room", namely Deutsche Bank's $75 trillion in derivatives which as we said at the time was about 20 times bigger than Germany's GDP, and 5 times bigger than the entire economic output of the Eurozone."


This was largely ignored by the "experts" because why bring attention to something which is fundamentally a devastating break in the narrative that "Europe is fine" and the financial crisis is now contained.

Fast forward to today when Europe is once again not fine, only this time one can't blame Europe's problems on Greece (instead the same "experts" are trying to blame everything in Brexit), when in a surprising admission of reality, none other than Italy's prime minister Matteo Renzi, "went there" and slammed Deutsche Bank as the true "derivative problem" facing Europe.

To be sure, Renzi has his own problems, chief among which is how to pass a banking bail out of his insolvent banks without implementing the dreaded bail in mechanism unveiled in 2016 as the only permitted European bank resolution mechanism. Alas, in his push to bail out rather than bail in Italian banks, Renzi has faced stiff resistance from the Germans, namely Angela Merkel and Wolfgang Schauble who have both strongly opined against this kind of backtracking. Just today, Wolfgang Schaeuble, speaking at a news conference in Berlin (just hours after Italy hinted once again at an imminent bailout of Monte Paschi), said his Italian counterpart Pier Carlo Padoan told him that Italy intends to stick to the banking-union rules. Perhaps not.

So it is not surprising that when faced with stiff resistance from the Germans, Renzi decided to call a spade a spade when, as Reuters reports, he said that the difficulties facing Italian banks over their bad loans are miniscule by comparison with the problems some European banks face over their derivatives.

One look at the chart above and it becomes clear just who he was referring to.

As Reuters adds, speaking at a joint news conference with Swedish Prime Minister Stefan Lofven, Renzi said other European banks had much bigger problems than their Italian counterparts.

"If this non-performing loan problem is worth one, the question of derivatives at other banks, at big banks, is worth one hundred. This is the ratio: one to one hundred," Renzi said

So just like that the Mutually Assured Destruction doctrine is activated, because now that Deutsche Bank's dirty laundry has been exposed for all to see, Renzi's gambit is clear: if Merkel does not relent on bailing out Italian banks, the collapse of Italian banks will assure the failure of Deutsche Bank in kind. And since in a fallout scenario of that magnitude DB's derivative would not net out, there will be no chance to save the German banking giant, bail out, in, or sideways.

And now the ball is in Germany's court: to be sure, traders everywhere will be curious to see just how this diplomatic escalation in which the fingerpointing at insolvent banks is only just beginning concludes, and most of all, they will follow every word out of Merkel's mouth to see if the Chancellor will relent and give in to what is the first tacit case of financial - and factual - blackmail.

Ironically, even the best possible outcome, namely another bailout of every insolvent European bank, will merely accelerate the same populist anger that catalyzed the Brexit-driven schism in the first place, and lead to even more anger at what will, inevitably, be yet another banker bailout until ultimately the war of words between the classes becomes all too literal

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Re: Banks
« Reply #8 on: July 08, 2016, 07:03:23 AM »

2016-07-07 18:16



法国兴业银行董事长兼前欧洲中行(ECB)理事斯马吉(Lorenzo Bini Smaghi)指出,欧洲银行体系面临“系统性危机”,政府必须接受动用纳税人的钱为银行纾困、做为防止危机的最终手段。







Offline zuolun

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Re: Banks
« Reply #9 on: July 08, 2016, 02:11:31 PM »
3 things investors should know about Malaysia’s 2nd largest bank, Public Bank Berhad

By Lawrence Nga
July 4, 2016

There are really only three banks in Singapore’s stock market, namely, DBS Group Holdings Ltd (SGX: D05), Oversea-Chinese Banking Corp Limited (SGX: O39), and United Overseas Bank Ltd (SGX: U11).

But across the causeway from Singapore, there are many other banks listed in Malaysia’s stock market, Bursa Malaysia. One such bank is Public Bank Berhad (KLSE: 1295.KL), Malaysia’s second largest bank by market capitalistion.

Here are three pieces of information about Public Bank that investors may find useful:

1. Consistent profitability over the past decade

One of the biggest financial and economic stories of the past 10 years was the Great Financial Crisis of 2007-09. During that episode, many Western banks collapsed or were on the brink of failing.

But, as you can see in the table above, Public Bank had remained solidly profitable from 2005 to 2015. In that time frame, the bank also managed to grow its profit by nearly 250%, representing a compound annual growth rate of an impressive 13.2%.

2. A history of growing dividends

Public Bank has also been sharing the spoils with its investors. Its ordinary dividend has increased in nearly each year over the past decade, rising from RM0.288 per share in 2005 to RM0.56 per share in 2015.

The bank has a dividend yield of 2.9% with its 2015 dividend and current share price of RM19.44.

3. A historically low valuation

Public Bank currently has a price-to-book ratio of 2.4. This is high when compared to the three aforementioned banks in Singapore (they have PB ratios of 1 or less) as well as other big banks in Malaysia such as  CIMB Group Holdings Bhd (KLSE:1023.KL), which is priced at less than 1 times book value.

But, the chart below shows that Public Bank’s PB ratio at the moment is actually near a five-year low.


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Re: Banks
« Reply #10 on: July 08, 2016, 11:34:37 PM »

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Re: Banks
« Reply #11 on: July 10, 2016, 04:17:16 PM »

Deutsche Bank or * Bank?
By TheGoldAndOilGuy

Deutsche bank (DBK) shares dropped to fresh new lows with the various news announcements, as well as a feeling that Germany will not be capable of bailing out the bank. The imminent outcome for DBK is ‘bankruptcy’ while the world will have to bear the brunt of the fallout from all of the complicated ‘derivatives’ which are being held by Deutsche Bank.

DBKs’ outstanding ‘derivatives’ exposure is 20x the German GDP and 5x the Eurozone GDP.


Amongst all of the chaos, DBKs’ head of currencies trading and emerging-markets debt trading, Ahmet Arinc, has left the company which is the most recent negative news to impact the banks’ financial status. Traders slammed the stock by more than 6% during that trading session, to touch intraday lows of $12.5 after which the stock recovered marginally to close at $12.97.

Germany will not be able to bail out DBK:
The latest bank which might require a bailout is the Italian lender Banca Monte dei Paschi di Siena which is the worlds’ oldest bank. The European Central Bank warned that the Italian bank is holding dangerously high levels of bad debt.

Italy wants a bailout for Monte Paschi, however, the Germans are opposing any such move. Wolfgang Schaeuble, the German Finance Minister, stated in a news conference, in Berlin, that Italy intends to stick to the banking-union rules, as was conveyed to him by his Italian Counterpart, Pier Carlo Padoan.

Italian Prime Minister hits back at Germany:

However, Italy did not wait before hitting back at Germany and it came from none other than the Italian Prime Minister, Matteo Renzi.

Mr. Renzi stated that “the difficulties facing Italian banks over their bad loans are miniscule by comparison with the problems some European banks face over their derivatives.” He reminded the Germans that there were other European banks which had much bigger problems than Monte Paschi, in an indirect hint towards DBK.

“If this non-performing loan problem is worth one, the question of ‘derivatives’ at other banks, at big banks, is worth one hundred. “This is the ratio: one to one hundred,” Renzi stated, reportsReuters.

More troubles ahead for DBK:
The bank is likely to lose its’ place in the STOXX 50 index, according to analysts at Societe Generale. The bank will face renewed selling pressure as the index funds will have to reposition themselves, post the change, which is more than likely to bring about a fresh round of selling.  According to a statement by the IMF, DBK is now the most dangerous bank in the world. DBK is currently the riskiest bank which will bring down the entire financial banking system, globally.

Gold is the key asset to own:
The bond king, Jeff Gundlach, stated that “things are shaky and feeling dangerous”. Regarding theEuropean banking crisis, the Double Line bond king noted: “Banks are dying and policymakers don’t know what to do. Watch Deutsche Bank shares go to single digits and people will start to panic… you’ll see someone say, ‘Someone is going to have to do something’.”

Gundlach stated that “gold remains the best investment amid fears of instability in the European Union and prolonged global stagnation, as well as concerns over the effectiveness of central bank policies,” reports Reuters.

The belief by Wall Street that Germany will not allow DBK to fail is fading. Post the Brexit, tensions are running high among the remaining members, as seen in the spat between Germany and Italy. Due to the earlier hard stance of the Germans, it is likely that any move to bailout DBK will face considerable resistance from all of the member nations. If allowed to fail, DBK will cause a ‘crisis’ many times over that of which Lehman Brothers did. The final meltdown commences!

Americans need to pay attention to this European Financial Crisis because its’ very contagious and going to spread here

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Re: Banks
« Reply #12 on: July 12, 2016, 07:36:24 AM »
Brexit-induced plunge in European bank shares threatens to cripple the continent's credit creation ~ 11 Jul 2016

Bank Run July 2016 ~ 11 Jul 2016

The economist explains: Why Europe’s next crisis may be in Italy ~ 11 Jul 2016

Is a run on Italian banks a possibility? ~ 5 Jul 2016

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Re: Banks
« Reply #13 on: July 14, 2016, 08:36:27 AM »
Maybank (1155) ~ Trading below the 200d SMA

Maybank closed with a black marubozu @ RM8.12 (-0.08, -1%) with high volume done at 11.2m shares on 13 Jul 2016.

Immediate support @ RM8.05, immediate resistance @ RM8.20.

Expect Maybank's share price to retest low of RM7.68 scored on 17 Aug 2015 and move much further down.

Maybank closed with a black marubozu @ RM8.12 (-0.07, -0.9%) with 4.87m shares done on 29 Jun 2016.

Malaysia central bank cuts overnight policy rate to 3% ~ 13 Jul 2016

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Re: Banks
« Reply #14 on: July 14, 2016, 12:24:22 PM »
CIMB ~  Trading below the 200d SMA

CIMB closed with a black marubozu @ RM4.32 (-0.06, -1.4%) with 13.6m shares done on 13 July 2016.

Immediate support @ RM4.28, immediate resistance @ RM4.42.

Expect CIMB's share price to retest the last low of RM3.84 scored on 18 Jan 2016.

UBS said to have flagged suspicious 1MDB transactions to MAS ~ 13 Jul 2016

Pua: Deloitte can lodge police report on 1MDB ~ 13 Jul 2016

Malaysia's 1MDB agrees to request for arbitration filed by UAE's IPIC ~ 11 Jul 2016

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Re: Banks
« Reply #15 on: July 14, 2016, 04:04:19 PM »
OPR cut positive for consumer and businesses, negative for banks ~ 14 Jul 2016

CIMB says Malaysia's 25bps OPR cut would lower banks’ FY17 net profit by about 5%

By Chen Shaua Fui
July 14, 2016 : 11:16 AM MYT

KUALA LUMPUR (July 14): CIMB Investment Bank Bhd said Malaysian banks' financial year 2017 (FY17) net profit could fall by about 5%, following the 25 basis-point (bp) cut in the overnight policy rate (OPR).

Yesterday, Bank Negara Malaysia cut the OPR to 3% from 3.25%, due to slower global economic growth concerns. "Looking ahead, there are increasing signs of moderating growth momentum in the major economies," Bank Negara said.

Today, CIMB analyst Winson Ng said the OPR cut should lead to a reduction in banks’ lending rate, but the decline might not be as big as 25bps.

"In the worst-case scenario, a 25bps OPR cut would lower banks’ FY17 net profit by about 5%. On a positive note, the rate cut should catalyse the banks’ loan growth.

“Following the OPR cut, we think that banks will lower their lending and fix deposit (FD) rates by up to 25bps, but the magnitude is still uncertain at this juncture," Ng said.

Ng said CIMB maintained its “overweight” call on the banking sector, premised on potential re-rating catalysts like earnings per share recovery in 2016 and attractive valuations.

He said Bank Negara's rate cut was expected to "revive banks’ loan growth."

“While the magnitude of the cuts in lending and FD rates are still uncertain, we believe banks will try to minimise any margin contraction, especially in light of their currently thin net interest margins, following years of margin erosion. On a positive note, the rate cut would, to a certain extent, help to revive banks’ loan growth. Our top pick is RHB Bank Bhd,” CIMB said.

SP Setia calls for loosening of lending rules with OPR cut ~ 14 Jul 2016

1.  Chartwise, expect SP Setia to retest the last low of RM2.80 and move much further down.
2.  Should there be a dead cat bounce due to short-covering — Sell into strength, run road fast.
3.  The cash call (rights issue of up to 1.07b new RCPS-i and rhe 19 sen dividend entitlement have already been priced in.
4.  The BREXIT -ve impact has not been priced-in yet (re Performance chart below).

Performance chart ~ Malaysian firms with exposure to UK and/or EU ~ 4 Jul 2016

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Re: Banks
« Reply #16 on: July 20, 2016, 07:47:21 AM »
Singapore bondholders brace for defaults as easier terms sought ~ 17 Jul 2016

Otto Marine, which owns a fleet of vessels to support oil companies, said in a statement dated July 15 that a resolution was passed by bondholders to postpone the maturity of its S$70 million 7 percent notes due August 1 to February 1, 2017. The company’s controlling shareholder is seeking to delist the company and plans to use a loan extended by RHB Bank to repay bondholders assuming the delisting is completed..

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Re: Banks
« Reply #17 on: July 20, 2016, 09:05:40 AM »

Jim Rogers Warns Deutsche Bank is Broke, Derivatives Collapse Coming!
Posted on July 19, 2016 by The Doc   3 Comments   423 views
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Home » Headlines » World News » Jim Rogers Warns Deutsche Bank is Broke, Derivatives Collapse Coming!

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Offline zuolun

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Re: Banks
« Reply #18 on: July 22, 2016, 10:47:32 AM »
CIMB ~  Trading below the 200d SMA

CIMB had a a black marubozu and traded @ RM4.16 (-0.04, -0.95%) with 2.04m shares done on 22 July 2016 at 1010 hrs.

Immediate support @ RM4.11, immediate resistance @ RM4.28.

Expect CIMB's share price to retest the last low of RM3.84 scored on 18 Jan 2016.

CIMB closed with a black marubozu @ RM4.32 (-0.06, -1.4%) with 13.6m shares done on 13 July 2016.

CIMB Thai H1 net profit up 5.5% to RM42.5m ~ 21 Jul 2016

Malaysian shares slide amid global growth woes, 1MDB concerns ~ 21 Jul 2016

1MDB: Malaysian PM under pressure over $1bn US fraud case ~ 21 Jul 2016

CIMB Group remains on track for earnings recovery ~ 20 Jul 2016

Nazir Razak did not misuse his position, says CIMB board ~ 19 May 2016

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Re: Banks
« Reply #19 on: July 22, 2016, 04:15:32 PM »
Company in the news: CIMB

July 22, 2016

CIMB Group Holdings Bhd said its 93.71%-owned subsidiary CIMB Thai Bank PCL's second quarter net profit fell 82% year-on-year to 39.89 million baht (about RM4.8 million) on higher operating expenses and bad debt.

In a filing with Bursa Malaysia today, CIMB Group said CIMB Thai's net profit in the second quarter ended June 2016 (2QFY16) fell from 217.56 million baht a year earlier.

CIMB Thai's income statement showed that operating expenses rose to 1.73 billion baht while bad debt and impairment losses climbed to 1.38 billion baht.

For the six-month period (1HFY16), CIMB Thai president and chief executive officer Subhak Siwaraksa said in a separate statement that it posted a 5.5% increase in net profit at 367.2 million baht from a year earlier. Net profit rose on higher operating income as net interest income rose.

一马发展公司再起波澜,加上云顶卖压大影响,马股和马币双双败走 ~ 21 Jul 2016

美国1MDB诉状 提及大马1号官员 ~ 21 Jul 2016

Tony Pua (DAP): Who is 'Malaysian Official 1'?  ~ 21 Jul 2016

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Re: Banks
« Reply #20 on: July 23, 2016, 03:29:11 PM »
India Axis Bank first-quarter profit plunges 21%; hit by bad loan surge ~ 22 Jul 2016

1MDB saga: Probe flags Singapore money changer ~ 22 July 2016

Follow the money: 'The Wolf of Wall Street' corruption timeline ~ 22 July 2016

Mainland exposure of HK banks at manageable levels

Slowing Chinese economy crimping appetite for mainland lending, say industry experts

By Alun John
22 July 2016

Hong Kong accounts for nearly half of foreign banks’ claims on mainland China. While, this means that the city’s banks would be vulnerable to a sudden deceleration or hard landing on the mainland and their balance sheets would suffer, it would take an economic collapse across the border of major proportions for Hong Kong’s banking system to be fundamentally threatened, said industry experts.

Lending by Hong Kong banks to mainland China declined for the first time in a decade last year. By the end of 2015, total exposure to the mainland for Hong Kong banks consisted of 27.3 per cent of the total lending by Hong Kong banks, down from 32.8 per cent at the end of 2014, according to figures from global ratings agency Fitch Ratings.

“The fall has happened because of both supply and demand,” said Sabine Bauer, senior director of financial institutions for Fitch Ratings in Hong Kong. “Last year, Hong Kong banks became more concerned about lending to companies on the mainland, while the companies themselves chose to borrow less.”

This marks something of a turnaround. Back in 2006, Hong Kong banks exposure to the mainland’s non banking sector was just 6.6 per cent of their total. In the last decade, opportunities to lend to corporates, particularly state-owned firms, rose as the growing Chinese economy provided the banks with huge opportunities for growth.

“The increase in mainland Chinese exposure since 2006 was natural given the developing economic relationship between the mainland and Hong Kong,” said Chris Leung , senior economist for group research at DBS Bank in Hong Kong.

“However, if the economy in China continues its current deceleration it will cause problems for Hong Kong lenders. If the economy goes down, then inevitably the number of non performing loans will go up.

Tom Fyfe a partner at law firm Simmons & Simmons in Hong Kong said: “There is a lot of bad corporate debt in China. So, as that washes out, as it has to eventually in order to rebuild investor confidence, there will be liquidations (corporate bankruptcies). To that extent Hong Kong banks have direct exposure on their lending books and they will obviously get hit if they have not taken the write-downs already.”

Rising systemic leverage and weakening credit conditions prompted global ratings agency Moody’s Investors Service to cut their outlook for the mainland’s banking sector in March this year. “Growing leverage is making China’s corporate sector more vulnerable to potential shocks. Hence the quality of assets on the books of Chinese banks’ is deteriorating,” said Liu Mingyan, associate managing director of the financial institutions group at Moody’s Investors Service .

“The direct impact [on Hong Kong banks] of a rise in defaults and a hard landing on the mainland is of course subject to each bank’s respective exposure to the mainland,” said Thomas Dillenseger, senior director of Alvarez & Marsal, a professional services firm, in Hong Kong “However, the results of recent stress tests suggest that Hong Kong banks are well prepared for such an event,” he said.

One such stress test was carried out by Fitch, which also identified some banks that it said were more vulnerable to a slowdown on the mainland. “Chinese bank subsidiaries, as well as Bank of East Asia, have the largest share of impairments coming from mainland China exposure, due to their close business collaboration with their parents and the resulting high asset concentrations in mainland-related lending,” the test said.

A spokesperson for BEA said: “In view of the current economic slowdown on the mainland, we are proactively ensuring we address the changing market environment and have adopted a prudent approach to lending by focusing on large state-owned enterprises and customers with higher credit ratings and tightened credit guidelines.”

Leung from DBS said that it is important to distinguish between the different types of state firms when it comes to assessing the risks to the system. “SOEs in sectors where there is significant overcapacity, like steel for example, are the most vulnerable to defaults,” he said.

“Hong Kong banks, however, are not so stupid as to have lent heavily in those sectors.”

In fact, even though exposure to the mainland makes up a little under a third of Hong Kong banks’ total lending, from the mainland perspective of overseas lending is still comparatively small.

Michael Taylor, chief credit officer at Moody’s Investors Service said: “Most of the debt accumulation in China has been domestically funded. As the government is on both sides of these transactions – lending through the state owned banks, and borrowing through the SOEs, we don’t see this rise in leverage necessarily leading to a rise in financial dislocation in the near term.”

Most of the lending by Hong Kong banks has been towards the safer end of the spectrum. “When broken down by the borrowers, Hong Kong banks’ mainland China exposure is mostly to state-owned entities (42 per cent of non-bank loans) and non-mainland entities (38 per cent) operating in China,” said Fitch’s Bauer, adding that the scenario is changing..

“Fitch expects lending to onshore Chinese borrowers to increase as banks, including HSBC, focus on that segment for expansion. Lending to private enterprises – if they pick the better managed and better performing ones, could support banks’ loan quality,” Bauer said.

“Despite the short-term volatilities, we are confident in China’s long-term growth prospects.” said a BEA spokeswoman.

It does appear, however, that since Hong Kong banks’ exposure to the mainland dropped last year, many banks see these opportunities as being smaller than they were.

Nonetheless, even if a major slowdown on the mainland should occur, Fitch’s assessment is that the systemic stability of Hong Kong’s banking system would remain. In their recent stress test, Fitch explored two scenarios. In the more extreme one, which Bauer described, as “not what we expect to happen” they modelled the impact on banks in Hong Kong if they had non performing loan ratios of 7.5 per cent for Chinese state-owned enterprises, 8 per cent for non-mainland entities on the mainland, 20 per cent to private mainland borrowers and 5 per cent for claims on Chinese banks.

Even under this extreme scenario however, “all banks, except for BEA, are likely to maintain their capital level above the minimum regulatory requirements,” according to the test findings.

“Hong Kong banks are well prepared to withstand challenges from a downturn in the credit cycle due to their sound capital position and earnings buffers,” it said.

UBS, Standard Chartered targeted by Singapore for 1MDB lapses ~ 21 Jul 2016

Singapore seizes assets, to take action against major banks in 1MDB probe ~ 21 Jul 2016

Top HSBC manager charged in forex probe ~ 21 Jul 2016

ECB's Mario Draghi in emergency warning: Italy's bad loan crisis needs to be tackled now ~ 21 Jul 2016

Why Italy’s banks could ignite a eurozone crisis ~ 21 Jul 2016

China urges banks to step up risk controls as bad loans increase ~ 15 Jul 2016

Bank of East Asia facing questions over its anti-money laundering controls after 70 million yuan in transfers ~ 11 Jul 2016

$100 million money laundering probe in the Philippines: report ~ 11 Jul 2016

OCBC’s NPL to crumble further in H2 on back of O&G exposure ~ 8 Jul 2016

Moody’s cuts Singapore banking outlook to negative ~ 30 Jun 2016

Bank of East Asia plans layoffs, closures ~ 2 Jun 2016

Bank of Baroda money laundering case: ED sends LRs to Hong Kong, Dubai ~ 27 May 2016

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Re: Banks
« Reply #21 on: July 24, 2016, 06:49:00 PM »

Bank hacks raise fears for financial sector
AFP | July 24, 2016
hackersWASHINGTON: A series of spectacular cyber attacks against banks, resulting in the theft of tens of millions of dollars, has heightened fears for an industry becoming an increasingly attractive target for hackers.
Banks in Bangladesh, the Philippines, Vietnam and Ecuador have been victimized over the past year in the attacks on the global interbank service known as SWIFT, and some analysts expect more attacks to become public.
After news of the $81 million heist from Bangladesh’s central bank became public in May, SWIFT said the incident was “not a single occurrence, but part of a wider and highly adaptive campaign targeting banks.”
Since then, officials said banks have also been hit in the Philippines and Vietnam.
Meanwhile Ecuador’s Banco del Austro claimed in a lawsuit that hackers made off with more than $9 million through fraudulent SWIFT transfer requests.
Cyber security specialists say these attacks are likely just the tip of the iceberg, and expect more revelations.
“Cyber criminals are no longer targeting grandmothers at home for small amounts, but going directly where the money is,” said Juan Andres Guerrero-Saade, a researcher with the security firm Kaspersky.
Guerrero-Saade said it’s not clear where the attacks are coming from, but that the hackers are using techniques similar to those developed for cyber espionage.
“I don’t think this implies it’s nation-states, it’s more of an evolution,” the analyst said. “It’s criminal actors taking on some of those techniques.”
Kaspersky researchers last year uncovered a hacker group which targeted banks in Eastern Europe, estimating losses totaling up to $1 billion.
Dan Guido, cofounder of the security firm Trail of Bits and hacker-in-residence at New York University’s engineering school, said the recent security breaches are not surprising.
“I didn’t think it would take this long,” Guido said.
“There are a large number of attacks like this possible if someone has the resources to do it.”
Guido said a relatively small team of determined hackers could carry out the kind of hacks that went through SWIFT, or the Society for Worldwide Interbank Financial Telecommunication, a Brussels-based network which is used by more than 11,000 financial institutions in 200 countries.
More aggressive security

The blame, Guido said, rests squarely with SWIFT for failing to bolster its software or require more secure hardware.
“It’s clearly within their control to have prevented incidents like this,” Guido said.
“They could have had more aggressive security requirements, they could have had protective hardware.”
On July 11, SWIFT announced it had hired cyber security firms BAE Systems and Fox-IT while creating its own security intelligence team in an effort to thwart attacks.
In the United States, concerns have been raised among officials, industry leaders and lawmakers about potential threats to banks from hackers.
Data breaches in the past affected some tens of millions of JPMorgan Chase customers, and accounts from financial giant Morgan Stanley. And a congressional report in June found “major data breaches” at the Federal Deposit Insurance Corporation.
Senator Tom Carper last month asked the Department of Homeland Security for a briefing for an investigation into vulnerabilities of the US financial system.
The American Bankers Association in July joined with other financial and security organizations to warn of possible risks.
“While recent events targeted national financial institutions with access to a global payment network, financial institutions should assess the risk of all critical systems to ensure appropriate controls are in place,” said the warning, calling for a series of new controls and safeguards against cyber attacks.
Doing reconnaissance
Christiaan Beek of Intel’s McAfee Labs said the hackers that targeted SWIFT were well organized and resourceful.
“We can see that the attackers have done their reconnaissance properly and may have used an insider to get the details they needed to prepare their attack,” Beek said in a blog post.
“The attackers have a very good understanding of the SWIFT messaging system and how to manipulate the system to prevent the detection of their fraudulent attempts of transferring the money.”
Researchers at the security firm Symantec concluded that malware used in the bank hacks shared code with that used in the massive 2014 cyber attack against Sony Pictures.
Guido said it is entirely plausible that US banks could face similar attacks.
“I don’t see why it can’t happen here,” he said.
“There are a lot of smaller banks that don’t have expertise and guidance to protect their interconnections.”
Guerrero-Saade said a key part of staying ahead of hackers is sharing information about threats to enable security solutions, since many companies fear disclosure would hurt their business.
“Sadly most companies don’t tend to be very forward looking, they think that if they don’t sound the bell themselves no one will find out,” he said.
“It’s much better for us to get ahead of this as an international community.

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Re: Banks
« Reply #22 on: July 30, 2016, 07:53:36 AM »
Public Bank paying RM1bil in dividends ~ 29 Jul 2016

PermataBank ends in the red again, while Maybank’s profits soar ~ 29 Jul 2016

Maybank Indonesia profits more than double in H1 ~ 29 Jul 2016

CIMB’s Indonesian arm posts 318% jump in profit  ~ 29 Jul 2016

Wall Street banks making more risky loans, regulators warn ~ 29 Jul 2016

DBS shares drop 2.5% on S$700m Swiber exposure ~ 29 Jul 2016

Auto loans – The next subprime style crisis? ~ 29 Jul 2016

European shares fall led by financials, disappointing results ~ 28 Jul 2016

Swiber's sudden failure puts focus on bondholders yet to be paid ~ 28 Jul 2016

Swiber to wind up, biggest Singapore casualty of oil slump ~ 28 Jul 2016

OCBC, UOB report mixed performances ~ 28 Jul 2016

Singapore oil rigs' bad habits ~ 27 Jul 2016

Italian banks rank among worst in Europe by Texas ratio ~ 6 Jul 2016

Sluggish sectors in a slow economy - bevy of bad signs for banks ~ 3 Jul 2016

Malaysian banking industry showing trend of weakness ~ 2 Jun 2016

Maybank’s Q1 net profit plunges 16.1% on provisions ~ 28 May 2016
  • Maybank was the only bank that saw a significant surge in the absolute non-performing loans trend.
  • The increase in provisioning was primarily owing to the rise in the number of corporate loans undergoing restructuring and rescheduling of their repayment to better match their projected cash flows arising from the subdued operating environment.
  • Allowances for impairment losses on loans, advances, financing and other debts increased by RM617.1 million to RM865.1 million.

3 industries in Malaysia that are in for a tougher 2016 ~  4 Jan 2016
  • 1. Automotive industry
  • 2. Retail
  • 3. Oil & gas
5 industries in Singapore that may be facing a tougher 2016 ~ 18 Dec 2015
  • 1. Shipping
  • 2. Retail
  • 3. Hotels
  • 4. Airlines
  • 5. Manufacturing

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Re: Banks
« Reply #23 on: August 03, 2016, 12:05:06 AM »
Ringgit sinks as crude’s tumble bodes ill for Malaysia finances ~ 2 Aug 2016

Maybank, RHB Bank minimal exposure to Singapore’s Swiber ~ 2 Aug 2016

Loan growth remains weak at 2.8%

By AffinHwang Capital
August 2, 2016

This article first appeared in The Edge Financial Daily, on August 2, 2016.

Banking Sector
Maintain Overweight: June 2016 loan growth (+5.6% year-on-year) saw yet another subdued month as business loan growth and household loan growth continue to trend lower. The annualised system loan growth remained weak at 2.8% mainly due to the weak growth in the first four months of the year.

However, we note that June’s loan growth continued the positive momentum seen in May, as business loan growth year to date turned positive for the first time in 2016 while loan applications, approvals and disbursement levels also showed some encouraging signs.

We retain our loan growth forecast of 6% for 2016 (based on 6.4% growth from the household sector and 5.5% from business sector) as we believe that the general strength in the domestic economy, with a low unemployment rate of 3.4% (May 2016), coupled with sufficient liquidity in the banking system and a more accommodative monetary policy should continue to support credit growth in 2016.

We also do not rule out a more aggressive upcoming fiscal budget 2017 ahead of a possible national election next year although any positive spillover effects are likely to be more apparent towards the end of 2016 and 2017. With the recent cut in the overnight policy rate (OPR), most banks have reduced their base rate by 15 basis points (bps) to 25bps. We believe that this is positive for business loan growth, especially with the expected commencement of some major infrastructure projects in second half of 2016 (2H16).

Meanwhile, effects on household loans are likely to be more subdued as banks remain cautious about the approval of residential loans amid a high household debt to gross domestic product level.

National Property Information Centre primary property market preliminary data also showed that overall units launched and sold in 1H16 plunged to 10,655 units (1H15: 49,280 units) and 2,732 units (1H15: 23,909 units) respectively (Source:

Therefore, the 25bps OPR cut may not be significant enough to boost the fragile confidence among property developers and buyers. Nevertheless, the OPR cut in general still represents positive news for the ailing property market.

The industry loan loss cover slid to 89.5% as system gross impaired loan ratio continued to see a slight uptick to 1.66%, as at June 2016. Key sectors which remain vulnerable include construction, manufacturing and transport, storage and communication. On a more positive note, feedbacks from management of local banks have indicated that a lower loan loss cover is a result of better collaterised impaired loans. With less provisions set aside, we do not foresee any significant negative surprise in terms of credit cost for the upcoming 2Q16 results for the sector.

We note that overall sector valuation for banks in 2016 remains  quite attractive at a 1.07 times price to book value (P/BV) multiple versus the 3-year average of 1.5 times. For sector exposure, we expect CIMB Group Holdings Bhd (“Buy”, RM4.39; target price [TP] of RM5 at 1 time P/BV) to see a more significant turnaround in 2016 estimated earnings in the absence of staff rationalisation cost and hefty provisions at PT CIMB Niaga Tbk.

For RHB Bank Bhd (“Buy”, RM5.09; TP of RM6 at 1.15 times P/BV), we expect an improved earnings profile with a relatively steady net interest margin as well as better asset quality and strengthened capital ratios post-rights issue and internal restructuring.

Moreover, we continue to like defensive banks such as Public Bank Bhd (“Buy”, RM19.50; TP of RM21.80 at 2.5 times P/BV) given the group’s more stringent credit underwriting standards and established franchise in the domestic retail financing markets. We also like Alliance Financial Group Bhd (“Buy”, RM3.98; TP of RM4.50 at 1.36 times P/BV) as a niche and nimble small-cap bank — AffinHwang Capital, Aug 1.

How to fill RM28 billion hole at 1MDB? ~ 2 Aug 2016

1MDB owes a total of RM5.037 billion to local banks ~ 26 Mar 2015

1MDB pays back $750m loan owed to Malaysian banks

Feb 16, 2015

Malaysian state fund 1Malaysia Development Bhd (1MDB) has settled in full a RM2 billion (S$753 million) loan that it owed local banks, its executive director Arul Kanda said on Friday.

"The loan was settled in advance of the due date, per the terms of the loan facility agreement," Mr Kanda said in a statement emailed to Reuters.

The loan repayment should ease pressure on the ringgit and Malaysia's credit outlook. The intensification of 1MDB's troubles has increasingly been cited as a factor affecting Malaysia's longer-term economic outlook.

1MDB, whose advisory board is chaired by Prime Minister Najib Razak, has amassed US$11.6 billion in debt as it built up a large portfolio of power plants.

Long dogged by controversy over its debt, 1MDB's woes increased when it missed payments on a bridge loan that was originally due at the end of December. The fund was given a final deadline of Feb 18 to pay the loan, local media reported.

"With the settlement of this loan, I reaffirm 1MDB's commitment to continue meeting all our debt obligations as they become due," said Mr Kanda.

The loan was owed to the country's largest bank Malayan Banking Bhd, smaller lender RHB Capital Bhd and others.

Reuters reported on Tuesday that Malaysian billionaire Ananda Krishnan was preparing to settle the US$550 million loan owed by 1MDB in a reprieve for the fund.

The fund appointed a new CEO in January and announced plans for a strategic review. It is also looking at selling some of its property assets, people familiar with the matter have told Reuters.

Meanwhile, Malaysia's national oil company Petroliam Nasional Bhd (Petronas) is paying for troubles at 1MDB.

The yield premium on Petronas's 2022 US dollar-denominated debt over Treasuries has surged 53 basis points in the last six months after the government said it wasn't liable for 1MDB's debt and the fund missed the loan payment which was only repaid on Friday. That was unfortunate timing for Petronas, which is planning its first dollar bond in five years to raise as much as US$7 billion, according to people familiar with the matter.

The cost of insuring Malaysian sovereign debt reached a 16-month high on Jan 13, one week after local media reported 1MDB's missed payment, and is up 27 basis points since Dec 31. Fitch Ratings said last month it may downgrade Asia's only net crude exporter, citing plunging oil prices and "uncertainty" surrounding finances of the investment fund, whose advisory board is headed by the prime minister.

Petronas's sale of dollar-denominated Islamic bonds may become its biggest such offer to date. It's working with Bank of America Corp, CIMB Group Holdings Bhd and Deutsche Bank AG to lead the offering, said the people familiar with it, who asked not to be identified because the details are confidential.

The last time Petronas sold dollar notes was in August 2009, when it issued US$4.5 billion of bonds. Fitch gives Petronas an A rating with a negative outlook, one level higher than Malaysia's A- grade.

Natural gas futures dropped to US$2.58 per million British thermal units (BTU) on Feb 6, the lowest since 2012, while the price of Brent futures is down 49 per cent since last June. Petronas derived 21 per cent of its revenue from gas and an equal amount from crude, with petroleum products being the biggest contributor to its top line, according to its 2013 annual results.

About 30 per cent of the government's RM225 billion (S$85 billion) revenue in 2014 was oil-related, including a RM29 billion dividend from Petronas, according to the finance ministry. Petronas reported RM119.4 billion of cash at the end of the third quarter, compared with RM78 billion of total debt maturing within one year.

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Re: Banks
« Reply #24 on: August 07, 2016, 09:39:01 AM »
Singapore banks' bad loan provisions for oil and gas sector 'may not be enough', Moody's warns ~ 5 Aug 2016

DBS's S$17 billion exposure to O&G sector in focus

Shareholders also expected to grill Piyush Gupta on why bank failed to see signs of Swiber's cashflow problems

Aug 5, 2016

DBS's upcoming second-quarter results briefing on Aug 8 is likely to be dominated by questions over its S$700 million exposure to failed Swiber Holdings and the consequent S$150 million hit to its earnings.

That probably means Q2 net profit - instead of an estimated S$1 billion plus - will probably be lowered by SS$150 million.

Prior to news of Swiber's collapse, five analysts had estimated that DBS would post Q2 net profit of around S$1 billion, according to Bloomberg.

Oil services firm Swiber went belly up on July 28 and is now under judicial management.

The expected grilling will zoom in on how DBS, given that it is the company's main banker, failed to see signs that Swiber was having cash flow problems amid contract delays from the latter's customers.

DBS chief executive Piyush Gupta will have to show that he is on top of the bank's S$17 billion exposure to the oil and gas sector, which accounts for 5.9 per cent of its loan book. After all, it was only in May when he said that he didn't see any imminent signs of weakening in the bank's oil and gas exposure.

DBS has said that of its S$700 million exposure to Swiber, it expects only half of this to be recovered because the exposure is only partially secured. It said that it would tap its general allowance to provide for the anticipated shortfall, taking its net allowance charge to S$150 million.

"Management intends to take the required specific provision upfront and bite the bullet in 2Q16," said Jonathan Koh, UOBKayHian analyst in an Aug 1 note.

The estimated specific provision of S$150 million would be charged to profit & loss for Q216 after writing back surplus general provision of S$200 million, he said. DBS has sufficient surplus general provision of S$629 million on its balance sheet as at March 16.

"We estimate that net profit would be reduced by 12.8 per cent to S$882 million for 2Q16," said Mr Koh.

While Swiber's collapse and Singapore banks' continued exposure to the struggling oil and gas sector remains front and centre, investors will also want to see how DBS is performing amid a lower for longer interest rate environment and a sluggish economy.

Rivals OCBC Bank and UOB reported their Q2 results last week.

Some analysts think that DBS's loans may stabilise after falling in Q1 and that its margins may take less of a dent as the bank is better at managing its deposits cost.

One analyst said that a meeting with DBS management (pre-Swiber) suggested that Q2 loan growth would be healthy from market share gains in mortgage and deal-related lending.

Bank lending continues to slide in a weak economy. The official forecast for full year 2016 growth is in the range of 1-3 per cent. Business lending fell 6.2 per cent to S$345 billion in June 2016 from a year ago - a contraction not seen since October 2009.

Business loans have been falling for 10 straight months now. Overall, bank lending in Singapore fell by 2.7 per cent in June year on year.

A bright spot is consumer loans, mainly boosted by mortgages, which rose 2.8 per cent in June from a year ago to S$245 billion, rising at the same pace in May.

The Q2 numbers of OCBC and UOB week were not sparkly - loans were flat at OCBC and up 3 per cent at UOB. Margins fell as interest rates plunged in the March to June period.

The key 3-month Sibor rate which is used to price home loans has fallen to 0.87 per cent from a January high of 1.25 per cent while the 3-month SOR used for commercial loans has plunged to 0.84 per cent from its January high of 1.76 per cent.

At OCBC, net interest margin (NIM) dropped seven basis points from a quarter ago while at UOB, it fell a bigger 10 basis points.

DBS's total loans in Q1 fell due to continued trade loan contraction but that should begin to level off, said Mr Koh.

DBS's CASA or current account/savings account ratio is superior to its rivals, so the hope is that NIM compression won't be as bad as theirs, said a third analyst.

CASA deposits pay zero or almost nothing to savers so DBS's CASA ratio of 62 per cent to total deposits as at end-March should help mitigate the impact of declining rates. OCBC's and UOB's CASA ratios are 49 and 43 per cent respectively.

As for DBS's non-interest income, there could be higher fees from doing two IPOs in Q2 - ManuLife US Reit and Frasers Logistics & Industrial Trust. Higher credit card fees is also likely from the Great Singapore Sale. OCBC and UOB also got nice boosts from credit card fees in Q2.

More of a wild card is trading income. UOB enjoyed higher trading income but it was flat at OCBC in Q2.

Thirteen lenders extended over US$736m of facilities to Swiber group

Court hearing on firm's judicial management confirms DBS as single largest creditor; followed by China Development Bank, ICICI and UOB

Aug 5, 2016

Thirteen banks and financial institutions have extended Swiber Holdings and its subsidiaries banking facilities totalling more than US$736 million, an affidavit obtained by The Business Times from Tuesday's court hearing on the judicial management application filed by the listed offshore and marine (O&M) group has showed.

A list of banking facilities in the affidavit confirmed earlier reports by The Business Times, which had flagged DBS Bank as the largest creditor to Swiber. United Overseas Bank (UOB) came in a distant fourth with over US$35 million, after China Development Bank with over US$131 million and Mumbai-based ICICI Bank with over US$50.9 million.

A significant number of DBS's bank facilities are tied to ongoing projects Swiber has secured with India's Oil & Natural Gas Corporation.

DBS has a property loan tied to Swiber's business office. The bank - as well as UOB - are involved in several vessel loans on Swiber's operating fleet.

Also on the list are international lenders including Deutsche Bank, HSBC, Citibank and AFC, along with Kuala Lumpur-listed Maybank. Amex, GE-PK AirFinance, Hitachi and IBM have been named in association with certain financial services including hire purchases extended to Swiber. According to the list, the exposure of each of these international banks or financial services providers is capped at under US$17 million.

The list validated an OCBC executive's statements suggesting the bank has not extended loans to Swiber. BT also confirmed that Bob Yap Cheng Ghee and Ong Pang Thye of KPMG Services Pte Ltd were appointed as the joint judicial managers following the High Court hearing.

The High Court on Tuesday heard Swiber's judicial management application filed after the board of directors of the listed O&M player dramatically reversed a winding-up petition last Friday.

Swiber's now-rescinded liquidation bid announced in a July 28 Singapore Exchange filing shook up Singa-pore's O&M and banking sectors as well as the stock market.

The market has been abuzz with questions as to why Swiber's board of directors had opted to go with a winding-up petition instead of opting for judicial management, under which the listed group and its subsidiaries can still continue to generate cash from its ongoing projects.

Its subsequent judicial management application is viewed as a more positive development especially for unsecured trade and bank creditors and bondholders.

Gibson Dunn & Crutcher LLP's partner, Robson Lee, said unsecured creditors rank at the bottom of insolvency payment priority with many walking away with very little or nothing at the end of liquidation proceedings.

The affidavit from the High Court hearing described DBS as the single largest creditor of Swiber. The bank is reported to have played an instrumental role in convincing Swiber's board to rescind its liquidation bid in favour of filing for judicial management.

In addition to the loans tied to Swiber's property, vessels and projects, DBS has also extended a bridging loan in the form of an overdraft facility totalling US$146 million for redeeming the group's medium term notes (MTN) due on June 6 and July 6.

BT had earlier reported that DBS private equity division is believed to have also exposure to multiple Swiber's MTN programmes, although this has not been confirmed by the bank.

China's provinces enlist banks to defy overcapacity cuts ~ 14 Jul 2016

Italy's teetering banks will be Europe's next crisis ~ 7 Jul 2016

Mom and pop investors will rule the world ~ 11 Apr 2016

OCBC relationship manager sold us risky investment product, ruined our retirement

8 Apr 2016

If it seems too good to be true, it probably is...

Our encounter with OCBC Premier Banking has been a living nightmare; we are sharing our experience to raise awareness of the bank’s ruthless tactics behind its smiling public facade.

Our bank relationship manager sold us a ‘4 month SGD Equity Fix Coupon Quanto Callable Investment’ product when we asked for a short-term savings plan or stable investment to allow us to earn a small incentive for our nearing retirement. We had some concerns regarding the choice of shares initially, but she assured us that the bank’s investment experts will assist in choosing shares with high growth potential, and even claimed that some of her customers were already earning profits. We were not sophisticated investors and were definitely not interested in high-risk investments, but she continually assured us of the stability of this investment, so we signed the deal under the impression that it was a stable short term investment with satisfactory returns.

Everything went well for the first 3 months until just before the maturity date, when she informed us that our investment had incurred a loss and advised us to hold it until it recovers. We had no access to any stock exchange or share price information, until the 7th month when we received a wealth report from the bank indicating, to our horror, that our investment value had dropped by more than half, and is now worth almost nothing.

We requested for a market analysis report of the company share and realized that the company was in fact a very unstable and high-risk one, unlike what our Relationship Manager described. There was no transparency in the entire transaction.

We appealed to their management and subsequently their Customer Assurance team to no avail, and the latter shook us off by asking us to seek resolution through FIDReC which handles up to only S$50k per claim – barely half of what we have invested.

Every cent we saved and every carefully crafted plan we made over the years to pave the way for a smooth retirement – which seemed so close within our reach after decades of tireless work – had to be halted. Plans changed. Dreams shattered.

We came to the bank to deposit our hard-earned savings with trust and hope to earn some incentive to support our retirement but instead it cost us almost everything we invested within just a few months. We hope our story will prevent others from being put through the same ordeal.”

Moral of the story – If a deal sounds too good to be true, it probably is.

Mom-pop investors rush into Swiss property at riskiest time ~ 29 Feb 2016

Italian bank panic & bail-in – The next domino to fall ~ 26 Jan 2016

Man kills himself as bank failure wipes out savings

10 Dec 2015

The death of a pensioner, who killed himself after losing his life savings as a result of a controversial move by the government to rescue four banks, has sparked outrage in Italy, with two consumer associations calling for a criminal case inquiry.

The 68-year-old hung himself at his home in Civitavecchia, a port town near Rome, after the so-called “save banks” plan wiped out €100,000 in savings held at Banca Etruria, one of the four lenders included in the government rescue deal announced on November 22nd.

“This is a disgrace and an absolute tragedy – the deposits of smaller investors are not guaranteed. The people managing the banks must be the ones to take responsibility,” Elio Lannutti, the president of Adusbef, a consumers' association which alongside Codacons has asked criminal prosecutors to start an investigation, told The Local.

The rescue deal, set up by the Bank of Italy, saw the creation of a private fund to raise €3.6 billion for the struggling banks, which included Banca Marche, CariFerrari and CariChieti.

If the bank rescue had come just five weeks later, the man's savings and those of thousands of others might have been saved by new EU rules, which come into force on 1st January.

The intention is to restructure and recapitalize the lenders with funds raised from Italy’s healthy banks, while combining their non-performing loans in a separate “bad bank”.

The rescue plan was ushered in before the EU's so-called "bail-in" rules  – under which account holders with deposits of more than €100,000, along with shareholders and bondholders, would bear the brunt of losses before any public money can be used to bail a bank out - take effect.

But the move has seen some 130,000 people who held shares and bonds across the four banks lose their investments, Lannutti said.

"It amounts to a complete swindle. The only guarantees in place are for the higher savers,"  he added.

The pensioner, a former worker for the energy firm Enel, had banked with Banca Etruria for over fifty years, with most of his life savings tied up in bonds.

The government had promised to introduce a “humanitarian” measure to reduce the impact on small investors.

But that was no assurance for the pensioner, whose body was found by his wife a week after the rescue plan was announced.

In a document found on his computer, the man accused the bank of changing its strategy to protect bigger investors over smaller ones.

Months before the rescue plan was announced, he tried to recuperate his savings, even suggesting to the bank that he was prepared to accept less, Il Fatto Quotidiano reported.

Adusbef and Codacons have asked prosecutors to investigate whether the rescue plan decree is "compatible with criminal laws and the Constitution".

Matteo Salvini, the leader of the far-right Northern League, took to Twitter to call on the resignation of the Bank of Italy chief, Ignazio Visco.

He also lambasted the government, suggesting it was to blame for the suicide.

"Pensioner from Civitavecchia commits suicide, he loses his life savings because of Banca Etruria and an absent government."

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Re: Banks
« Reply #25 on: August 07, 2016, 11:04:31 AM »

End Game Trigger? Japan is on the VERGE OF COLLAPSE – Jim Willie
Posted on August 6, 2016 by The Doc   4 Comments   3,430 views
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bomb explosionWhy Did Ben Bernanke Fly to Japan Last Month to Meet With PM Abe?
In This Riveting Interview With Tru News, Golden Jackass Jim Willie Warns Japan Is On the Verge of Collapse, and the Fuse to Light the Bankster Derivative Nuclear Bombs Has Been Lit…

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Re: Banks
« Reply #26 on: August 08, 2016, 11:18:37 AM »
 :D :D :D...........a star is born!!!>>>

SMU graduate quits high-paying trader job for karung guni business :cash: :cash: :cash:
tumbsup: :thumbsup: :thumbsup: ;) 

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Re: Banks
« Reply #27 on: August 09, 2016, 09:36:40 AM »
DBS caught off guard by Swiber's 'swift implosion' ~ 9 Aug 2016

DBS profit falls as Swiber provisions offset interest income ~ 8 Aug 2016

Swiber wasn't showing signs of distress before implosion: DBS' Gupta ~ 8 Aug 2016

Penny stock DBS couldn’t save roils Singapore oil hub, banks ~ 8 Aug 2016

Specific allowances, or provisions for bad debts, rose to S$336 million in the June quarter, including S$150 million for Swiber, the bank said. Total allowances surged from S$132 million a year ago.

DBS soured loans mask something even more disturbing? ~ 8 Aug 2016

Singapore proves misery loves company in bad debt Asia ~ 21 May 2016

DBS’ Gupta gets biggest pay boost among top Singapore bank CEOs ~ 31 Mar 2016

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Re: Banks
« Reply #28 on: August 20, 2016, 10:33:55 AM »
Pledge on 1MDB funds recovery ~ 19 Aug 2016

Wira Dani, son of former Finance Minister Daim, declared a bankrupt ~ 19 Aug 2016

Swiber aside, the O&G nightmare for banks is far from over

By Gwyneth Yeo
August 18, 2016

Maybank Kim Eng is maintaining its negative rating on the Singapore banking sector, amid concerns over potential defaults and non-performing loans from highly leveraged oil & gas (O&G) support services companies.

Maybank Kim Eng’s Ng Li Hiang says the Swiber episode has highlighted the “elevated risks to Singapore banks’ balance-sheet exposure to the beleaguered O&G support services sector”. In particular, Ng notes that asset quality among banks had deteriorated in 2QFY2016 on the back of new non-performing assets from the sector.

To be sure, the O&G sector is not the only one facing challenges in this business environment. “Although O&G is not the only sector to face further asset quality deterioration, in the face of a broader sluggish economic growth environment, it is arguably the biggest pressure point amongst the various sectors’ loan exposure at this moment,” says Ng in a note on Thursday.

Bond yields have risen for some of the smaller O&G players in Singapore to between 25% and 30% according to Maybank Kim Eng’s estimates. At the same time, some Singapore-listed O&G companies like Cosco Corporation, Vard Holdings, Otto Marine and Ezra are overleveraged with a net debt to equity ratio of more than 100%.

In particular, O&G support services companies have some of the largest exposure to local lenders. DBS Group Holdings has the largest exposure among Singapore banks as 7% of its loans are for the O&G sector with 5% for the higher risk upstream and support services segments. In contrast, Oversea-Chinese Banking Corporation had a 6% exposure to O&G companies and 3% to the upstream and support services segments. United Oversea Bank has the lowest exposure, with 4% loans for the O&G sector and 2% for the upstream and support services segment.

Maybank Kim Eng estimates that Singapore banks’ non-performing loan ratio for the O&G support services is between 3% and 15%, which Ng says “is low given where the credit cycle stands today”.

If NPL (non performing loan) ratio reached 20% and 30% levels, Ng observed that the potential increase in specific provisions for DBS would be the largest among the three banks, of between 216% and 374%. In comparison, UOB’s specific provisions would increase 43% to 115%, and OCBC’s would increase by 34% to 101%.

Splitting the increased provisions evenly over FY2016 and FY2017, earnings for DBS will fall the most at between 3% and 5%, and UOB’s earnings will fall the least by 1% to 2%.

On the other hand, all three banks’ book values are expected to see minimal impact of less than 0.5% from higher NPL ratios.

Shares in DBS, OCBC, and UOB are trading at $14.77, $8.42, and $17.56 respectively at noon.

Wall St. banks ask Fed for 5 more years to comply with Volcker rule ~ 11 Aug 2016

The new Wall Street: Even big banks want help navigating markets ~ 10 Aug 2016

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Re: Banks
« Reply #29 on: August 31, 2016, 01:53:25 PM »
Singapore bank lending falls for 10th straight month in July on sluggish economy

By Chia Yan Min
31 August 2016

Singapore - Bank loans fell for a 10th straight month in July as the sluggish economy continued to weigh on business activity and sentiment.

Overall, loans slipped to S$597.2 billion in July, down 2.2 per cent compared with the same month last year, due largely to a decline in business lending.

Bank loans last suffered a similar extended decline in the 1980s, when total lending shrank for 12 months in a row, from May 1986 to April 1987.

Business loans fell 5 per cent year-on-year in July to reach S$351.8 billion, the 11th straight month of decline, according to preliminary data released on Wednesday (Aug 31) by the Monetary Authority of Singapore.

The sharpest drop was in the general commerce sector, with loans plunging 22 per cent year-on-year to S$59.7 billion.

Loans to manufacturers also experienced significant declines.

However, loans to financial institutions, construction industry firms as well as to companies in the transport, storage and communications sector grew. Lending to agriculture, mining and quarrying firms also ticked up, as did loans to business services firms.

Meanwhile, consumer loans went up despite the gloomy economic outlook, supported by an increase in mortgages, credit card interest payments and share financing.

Overall, consumer loans rose to S$245.5 billion in July, up 2.2 per cent from the same month last year.

Banks 'not out of the woods' from oil and gas exposure

By Jude Chan
30 August 2016 

Singapore - UOB Kay Hian on Tuesday maintained its “overweight” rating on Singapore banks, but says banks here are “not out of the woods yet”.

“Our ‘overweight’ sector call is premised on banks’ cheap valuations,” says UOB analyst Jonathan Koh in a Tuesday report. “We expect at least another two quarters of stress and deterioration in asset quality from the oil & gas (O&G) sector.”

The research house performed a stress test on banks’ earnings and target prices based on non-performing loan (NPL) ratio in the vulnerable offshore support services (OSS) segment within the O&G sector, as well as correction in collateral values.

“Our stress test indicates current share prices imply DBS’ and OCBC’s NPL ratios for OSS would hit 40-50% and valuation for collaterals would decline by a massive 70-80%,” Koh says.

In addition, Koh says sentiment remains fragile due to slower global growth and geopolitical uncertainties around Brexit and the US presidential election.

UOB has maintained its “buy” recommendations on OCBC and DBS with target prices of $10.30 and $17.80, respectively.

At at 11.21am, OCBC is trading 0.4% higher at $8.61 and DBS is trading 0.3% higher at $15.08.

Which bank is most exposed to the struggling oil and gas sector?

13 Jan 2016

Singapore - Bad loans will tick up as oil prices collapse.

Singapore's largest banks should prepare for more non-performing loans (NPLs) as oil prices drop to their lowest level in twelve years, according to a report by Maybank Kim Eng.

DBS is most exposed to the oil and gas sector. Its loans to O&G players amount to $22 billion, making up 8% of its loan book. DBS also has $9 billion worth of loans to oil and gas support services players, making up 3% of loans.

Meanwhile, OCBC has $13 billion of loans to the oil and gas sector, making up 6% of its loan book. It also has around $5 billion of loans to O&G support services providers, amounting to 2% of its total loans.

United Overseas Bank (UOB) has the smallest exposure to the sector. Its total O&G loans amount to $10 billion, making up 5% of its loan book. UOB did not disclose the amount of loans it has disbursed to O&G support services players.

In terms of other commodities excluding oil and gas, OCBC has the largest exposure to the commodities sector at $15 billion, or 7% of its loan book. This is followed by DBS with $12 billion, or 4% of its loan book, and UOB with $6 billion, amounting to 3% of its total loans.

"Asset quality deterioration for Singapore banks will linger, especially on their exposure to O&G and commodities,” Maybank Kim Eng said.

Cash up or ship out: it's the big O&M squeeze post-Swiber

Deleveraging and improving cash flow are key for offshore and marine players - but time may be running out for some, say analysts

29 August 2016

Singapore - CASH flow statements and debt refinancing plans of O&M (offshore and marine) counters have come under intense scrutiny, as analysts and stakeholders attempt to distinguish players more at risk than others.

It's a wake-up call triggered by the demise of the industry's once rising star, Swiber Holdings, which is now in the midst of a judicial management exercise.

A Business Times scan of small and mid-cap O&M companies - drawn from the watch lists of equity analysts - indicates a challenging patch ahead for many.

These O&M players face four key challenges: high debt-to-equity gearing of over 100 per cent; low or negative cash flows; short-term debt of above S$100 million; and/or medium-term-note redemption deadlines running through 2019.

BT drew on data released as at Aug 19 on Bloomberg, latest company results, and analyst reports.

Of the 14 companies on the list, 12 have short-term debt of over S$100 million, 10 have negative/low cash flow, and nearly all are highly geared.

With recovery still eluding the sector, the key to survival depends on how far industry players have deleveraged or cashed up to last through an industry shake-up in the wake of Swiber, analysts said. However, time may just not be on the side of many small and mid-cap industry players even as enquiries for oilfield services have increased.

IHS principal researcher Ang Dingli noted that oil companies have grown more accustomed to lower (but more stable) oil prices and may issue more tenders for new field developments at the end of 2016 or early 2017 as they are also being pressed to replace depleting oil and gas reserves. But Mr Ang qualified that these tenders will be released at a more deliberate pace and for limited projects.

He also warned that only "a few fortunate O&M players" - primarily large- cap yard operators with established track records in executing engineering, procurement and construction (EPC) projects - may benefit from any uptick. The rest would have to tread water at least until the end of 2017.

Mr Ang noted that EPC contractors - primarily those with a yard presence - have "already done what they could to lower costs either through restructuring or retrenchments of non-core staff".

He sees a lack of demand for their services as the bigger setback. Adding to the woes of small and mid-cap EPC contractors is excess capacity, partly from overinvestment in the module fabrication sub-segment in the days of high oil prices.

These contractors also face challenges from higher local content requirements imposed by some national oil companies that could restrict participation in subcontract work for new EPC awards.

EPC awards would also take months to multiply into contracting opportunities for supporting services including those for offshore support vessels (OSV).

The OSV segment is still haunted by a supply glut from excessive newbuilding and demand destruction from a slump in offshore drilling and EPC activities. Pareto Securities chief executive David Palmer said: "There is a tsunami of newbuilding (OSVs) completed and ready for delivery that are sitting in the yards."

The key uncertainty, according to Mr Palmer, is that "the exact number of newbuilding OSVs is indeterminate" and that "most industry numbers are understated". He suggested the supply glut - though more prevalent among shipshape OSV assets - has also compromised demand for liftboats, which were once touted as an asset class still above water.

One estimate is that hundreds of OSVs have yet to be delivered from China. M3 Marine's managing director Mike Meade noted that Chinese shipbuilders have tried to link up with active OSV operators to offload the excess vessels (resulting from defaults on shipbuilding contracts). The result could be more vessels competing for work in an already oversupplied OSV market.

One of the world's largest OSV owner-operators, Tidewater, recently breached an interest covenant, sparking speculation that the New York-listed player may file for Chapter 11 bankruptcy protection if it cannot secure waivers from its lenders and noteholders. Tidewater is headquartered in New Orleans and operates as a private-owned entity in Singapore.

On the situation here, Gibson Dunn & Crutcher LLP partner Robson Lee warned: "Holders of unsecured bonds issued by a company that has become mired in dire financial straits (such as Swiber) will have very little recourse to recover their investments in the event of an insolvent winding up." He noted that in such a situation, there is certainly no chance of any redemption. Others noted that bonds or debts in the O&M sector would have to be restructured (which typically involves either a substantial haircut or conversion to equity) or their repayments deferred. Support from lenders will be crucial.

Regional maintenance, repair and overhaul (MRO) solutions provider Mencast has, for instance, secured loan and credit facilities of up to S$74.9 million from UOB that will go towards redeeming S$50 million of outstanding bonds due on Sept 12, refinance certain liabilities, and provide for its working capital needs.

In Swiber's case, the affidavit for its judicial management application indicated that it had taken up lending facilities from DBS to repay medium-term notes due in June and July. BT earlier reported major local banks have worked with Swiber as well as Pacific Radiance to extend repayment deadlines for their loans. However, Swiber's subsequent troubles prompted some to ask if those efforts had been adequate in the face of a major O&M meltdown.

Unlike Swiber, some Singapore-listed players may be able to tap their cash-rich anchor shareholders. Malaysian tycoon Yaw Chee Siew, who has bankrolled Otto Marine through the years, set out earlier this year to take the OSV-focused player private. His decision to delist Otto Marine came as depressed O&M stock prices limited the effectiveness of further equity injections.

For O&M players with no cash-rich anchor shareholders to lean on, Mr Palmer extended a glimmer of hope: that the needed cash could eventually enter the system from "some unconventional sources not previously in this sector". But this may "severely dilute existing equity".

He warned that under the current excess capacity conditions (particularly severe in the OSV segment), "we will need to see more 'blood' before more sustainable capital will come in to fund companies".

But for the brave, there could be bargain-hunting opportunities. "Investors . . . have to tolerate extreme volatility and uncertainty in the short term but those who can identify companies that will make it through stand to (reap) fantastic returns," Mr Palmer said.

DBS is one of the principal bankers for almost all the O&M companies in the list.

Latest Splash Chat live Q&A casts a long, dark shadow over offshore ~ 26 Aug 2016

KrisEnergy faces debt covernant stress, bond value plunges ~ 16 Aug 2016

Double boost for Vallianz post-Swiber ~ 15 Aug 2016

Tidewater misses on earnings, may file Chapter 11 ~ 11 Aug 2016

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Re: Banks
« Reply #30 on: August 31, 2016, 05:40:50 PM »
Maybank (1155) ~ Trading below the 20d SMA, downside bias

Maybank closed with a black marubozu @ RM7.82 (-0.08, -1%) with 11.3m shares done on 30 Aug 2016.

Immediate support @ RM7.68, immediate resistance @ RM7.90.

Expect Maybank's share price to retest low of RM7.68 scored on 17 Aug 2015 and move much further down.

Maybank closed with a black marubozu @ RM8.12 (-0.08, -1%) with high volume done at 11.2m shares on 13 Jul 2016.

Maybank closed with a black marubozu @ RM8.12 (-0.07, -0.9%) with 4.87m shares done on 29 Jun 2016.

Slowing economy weighs on Malaysian banks' ops in S'pore ~ 30 Aug 2016

Maybank Q2 results below expectations ~ 26 Aug 2016

RHB Bank positive on prospects ~ 25 Aug 2016

Maybank posts third straight profit drop on loan impairments ~ 25 Aug 2016

Maybank, RHB top picks for banking sector

2 August 2016

PETALING JAYA: Hong Leong Investment Bank (HLIB) Research has maintained its “neutral” rating on the banking sector with Malayan Banking Bhd and RHB Capital Bhd as its top picks.

In a note yesterday, its analyst Chye Wen Fei said loan growth in June decelerated to 5.6% year-on-year (y-o-y), as both business and household segments registered slower growth of 4.2% and 6% y-o-y respectively.

Chye said the slower y-o-y loan growth was also reflected by slower growth in most segments including transport vehicles, purchase of residential and non-residential properties, personal use, working capital, coupled with a decline in purchase of securities segment.

However, he said the research house is still maintaining its loan growth projection of 7.5%, which is arrived based on 1.8 times of projected 2016 gross domestic product (GDP) growth (slightly lower than its historical average of 2 times).

“Leading indicators were mixed, with loan applications in June- 16 continuing to grow (albeit at a slower pace), while loan approvals on the other hand, resumed on a down trend, declining by 21% y-o-y to RM30.4 billion in June-16.”

“While liquidity is still ample to support economic growth, higher loan-to-deposit (LD) ratio could limit loan growth and pressure margin,” he said, adding that higher lending rates, coupled with more disciplined deposit competition will result in stabilisation in net interest margin compression.

In the note, Chye said deposits declined for the fourth consecutive month, by 0.5% y-o-y to RM1.47 billion, while excess liquidity narrowed to RM209.9 billion, from RM212.9 billion in May 2016.

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Re: Banks
« Reply #31 on: September 04, 2016, 10:29:25 AM »
Maybank (1155) ~ Trading below the 20d SMA, downside bias

Maybank closed with an inverted hammerr unchanged @ RM7.75 with 4.10m shares done on 2 Sep 2016.

Immediate support @ RM7.68, immediate resistance @ RM7.90.

Expect Maybank's share price to retest low of RM7.68 scored on 17 Aug 2015 and move much further down.

Maybank (weekly) ~ Longterm uptrend is broken

Maybank (1155) ~ Trading below the 20d SMA, downside bias

Maybank closed with a black marubozu @ RM7.82 (-0.08, -1%) with 11.3m shares done on 30 Aug 2016.

Immediate support @ RM7.68, immediate resistance @ RM7.90.

Expect Maybank's share price to retest low of RM7.68 scored on 17 Aug 2015 and move much further down.

Maybank closed with a black marubozu @ RM8.12 (-0.08, -1%) with high volume done at 11.2m shares on 13 Jul 2016.

Maybank closed with a black marubozu @ RM8.12 (-0.07, -0.9%) with 4.87m shares done on 29 Jun 2016.

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Re: Banks
« Reply #32 on: September 04, 2016, 12:48:47 PM »
PBBank (1295) ~ Trading in an upward sloping channel, upside bias

PBBank closed with a bullish harami @ RM19.90 (+0.14, +0.7%) with 2.7m shares done on 2 Sep 2016.

Immediate support @ RM19.75, immediate resistance @ S$20.00.

Public Bank (1295) ~ Blue-Sky Breakout

Public Bank closed with a long-tailed doji unchanged @ RM19.40 with 5.04m shares done on 1 July 2016.

Immediate support @ RM19.15, immediate resistance @ RM19.42.

Opportunity in best bank stock in Malaysia – Public Bank ~ 16 May 2016

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Re: Banks
« Reply #33 on: September 11, 2016, 05:09:45 PM »
Ringgit expected to trend lower against US$ next week ~ 10 Sep 2016$-next-week/

Singapore dollar forwards drop as traders see MAS policy on hold ~ 9 Sep 2016

USD/SGD jumps above 1.35 mark, faces strong resistance at 1.3538 ~ 9 Sep 2016*-faces-strong-resistance-at-13538-277579

Chart of the day: Check out Singapore banks’ plummeting customer yields

8 Sep 2016

They’re hovering just below the 1% level.

Sluggish domestic lending and the pressure to make up for its downsized China exposures have deflated Singapore banks’ customer lending rates and spreads, aggravating its deteriorating asset quality.

According to a report by Maybank Kim Eng, unless interest rates rear their heads, net interest margins could tighten.

“After GFC, Singapore banks were spared the worst of pricing pressures as they redeployed their excess capital to Greater China. But price pressures, especially on large corporate and consumer loans, are beginning to be palpable,” the report noted.

Meanwhile, the report noted that if banks cannot expand their credit spreads in a heightened risk environment, then they could find it even more difficult to sustain NIMs when the credit cycle normalises.

“Lower ROEs and, hence, valuations may become unavoidable. UOB has been able to maintain elevated lending yields thanks to its SME franchise. DBS has been able to push through lower deposit rates, as usual, and manage funding costs through lower customer deposit costs from CASA and/or synthetics,” the report added.

Singapore oil debt pain spreads as company ties make situation worse ~ 6 Sep 2016

Singapore is largest forex centre in Asia-Pacific, third largest globally ~ 2 Sep 2016

Bonuses paid to Singapore banks for selling risky debt under scrutiny ~ 25 Aug 2016

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Re: Banks
« Reply #34 on: September 28, 2016, 11:16:58 AM »
Worries over German banks sink bond issue, rattle shares ~ 27 Sep 2016

Maybank, IHH and Sime push KLCI deeper into the red ~ 27 Sep 2016
Fund selling of key stocks Malayan Banking Bhd (Maybank), IHH Healthcare Bhd and Sime Darby Bhd.

Malaysian banks brace for profit hits as oil and gas firms restructure debt ~ 27 Sep 2016

Banks bump up provisions ~ 27 Sep 2016

Malaysia the source of Asia’s dollar squeeze? ~ 27 Sep 2016
Malaysian banks' deposit growth has stalled, led by a 10% decline in foreign-currency deposits so far this year.

Deutsche Bank shares fall to lowest level since 1980s ~ 26 Sep 2016

China banks in dire need of new business: HK banks not so badly affected ~ 26 Sep 2016

Contagion risks rise as China banks fund each others’ loans ~ 26 Sep 2016

The implications of the Italian banking crisis could be disastrous ~ 21 Sep 2016

Analysts generally ‘neutral’ on banking sector ~ 14 Sep 2016

Is a cascade of defaults on the horizon for Singapore banks?

13 Sep 2016

Cross-transaction among O&G firms are making traders jittery.

Many traders feared that Swiber’s collapse could trigger a “cascade of defaults” on back of cross-transactions amongst oil and gas (O&G) firms on top of threats from “unknown unknowns.”

However, UOB Kay Hian asserts in a report that there has been no “cascading default” thus far.

“We agree that asset quality remains under pressure. However, it has been more than a month since Swiber filed for judicial management on 29 Jul 16 but another major default has not materialised,” the report noted.

Meanwhile, DBS remains in the doghouse. UOB Kay Hian stated that DBS’ pro-business and pro-growth disposition creates a perception that the bank takes on higher risk to achieve performance targets. Things may turn around for DBS, though, of non-performing loan (NPL) formation during 2H16 is lower than expectations, or if there are meaningful strides in Swiber’s recovery.

For OCBC, signs point that the bank’s conservative approach to recognise NPLs early is working. OCBC also has a pipeline of loans for upgrade after customers made timely repayments over 6-12 months. Therefore, the deterioration of its asset quality would be mild compared with peers as NPL formation is partly mitigated by upgrades.

UOB boasts the least exposure to the O&G sector, as loans extended to the sector amount to to S$9.3b or 3.9% of total loans. This stands in contrast to DBS’ S$20b (6.9% of total loans) and OCBC’s $12.6b (6.1% of total loans). UOB is thus more resilient and well positioned to weather the current credit cycle.

Banks’ commodity woes deepen as energy and metals earnings hit ~ 5 Sep 2016
  • Raw-materials income at 12 top banks fell 25% in first half
  • Banks’ risk levels reduced ‘quite substantially’: Coalition

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Re: Banks
« Reply #35 on: September 30, 2016, 06:07:40 PM »
Global stocks pressured by Deutsche Bank worries ~ 30 Sep 2016

European shares tumble as Deutsche Bank worries weigh ~ 30 Sep 2016

Seoul stocks slide on Deutsche Bank concerns ~ 30 Sep 2016

Asia markets stumble as Deutsche Bank concerns pressure banking stocks around region ~ 30 Sep 2016

Deutsche Bank chief Cryan tries to reassure on bank's strength ~ 30 Sep 2016

Deutsche Bank shares plunge below €10 in Frankfurt; Commerzbank slides 6% ~ 30 Sep 2016

Are Deutsche Bank's woes signalling another Lehmans moment? ~ 30 Sep 2016

Stocks slide as Deutsche Bank jitters boost yen, gold, bonds ~ 30 Sep 2016

Deutsche Bank drops to record as some clients reduce exposure ~ 30 Sep 2016

Credit Suisse, Barclays said to be in mortgage-settlement talks ~ 29 Sep 2016

Dow closes down triple digits after Deutsche Bank hits all-time low ~ 29 Sep 2016

German bank woes will dash Frankfurt’s great dream ~ 29 Sep 2016

A Nobel winner’s radical proposal to solve the Euro area’s woes ~ 29 Sep 2016

Keeping an eye on Deutsche Bank's woes ~ 29 Sep 2016

Deutsche Bank shareholders in for more pain ~ 29 Sep 2016

Dump Deutsche Bank ETNs now ~ 29 Sep 2016

Amid Deutsche Bank woes, rival German lender announces a major overhaul ~ 29 Sep 2016

Deutsche Bank CoCo bonds trading surges as crisis deepens ~ 28 Sep 2016

Now Credit Suisse chief Tidjane Thiam sounds alarm on European banks ~ 28 Sep 2016

Deutsche Bank woes stoking fears of 2008 financial crisis repeat ~ 28 Sep 2016

Trump's huge conflict of interest with a big foreign bank keeps getting worse ~ 28 Sep 2016
Deutsche Bank is in crisis. It holds more than $300 million in Trump's debt. That's a problem.

Angela Merkel's Deutsche Bank dilemma - is there a way out? ~ 27 Sep 2016
Deutsche Bank has an enormous balance sheet, especially when compared with the capital it holds, and a dizzying array of derivatives on its books. It is one of the world’s most interconnected financial institutions. Were it to fail, it would make the Lehman Brothers collapse look like an unexpectedly high credit-card bill and Brexit like a lovers’ tiff at the end of a long week.

How Deutsche Bank woes are stressing out the U.S. stock market ~ 26 Sep 2016

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Re: Banks
« Reply #36 on: October 03, 2016, 03:46:44 PM »

2016-10-03 10:31
德意志银行(Deutsche Bank)股价暴跌,投资者担心此银行正面临倒闭的风险。德意志银行乃德国最大的银行,在欧洲的地位举足轻重,如今竟然落得如此下场,令人感叹世事无常。


德意志过去20年的股价在很大程度上反映了它的兴起与衰退。 1999年,欧元区(Eurozone)推出了欧元作为成员国的统一货币。随欧元的诞生,欧元区受益于货币交易成本的降低,成员国之间的贸易逐渐提升,德意志银行从中得益,股价一度攀升至大约90元的高点。















Offline zuolun

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Re: Banks
« Reply #37 on: October 05, 2016, 08:55:17 AM »
When a stock is in a bear-market territory, the last low will be retested and the share price will move much further down, forming a new record low.

Maybank (1155) ~ Trading below the 20d SMA, TP RM6.90

Maybank closed with an inverted hammer @ RM7.58 (+0.08, +1.1%) with 6.52m shares done on 4 Oct 2016.

Immediate support @ RM7.50, immediate resistance @ RM7.68.

Maybank's share price had retested the last low of RM7.68 scored on 17 Aug 2015 and hit a new low @ RM7.50 on 30 Sep 2016.

Maybank closed with an inverted hammerr unchanged @ RM7.75 with 4.10m shares done on 2 Sep 2016.

Maybank (weekly) ~ Longterm uptrend is broken

Renewed selling pressure tipped for Malaysia shares ~ 4 Oct 2016

马银行会跌破7.50令吉?~ 2 Oct 2016

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Re: Banks
« Reply #38 on: October 07, 2016, 06:50:42 AM »

Is Deutsche Bank the trigger for the next financial crisis?
By Landon Thomas Jr, New York Times | Updated: Oct 06, 2016, 12.40 PM ISTPost a Comment
READ MORE ON » united states | speculation | markets | IMF | Gabriel India Limited | europe | Deutsche Bank
IMF said in a report on the German financial sector that Deutsche Bank appeared to be the riskiest bank in terms of threats posed to the globe.
IMF said in a report on the German financial sector that Deutsche Bank appeared to be the riskiest bank in terms of threats posed to the globe.
WASHINGTON: The International Monetary Fund did not bring up Deutsche Bank’s name when it warned in its financial stability report that cash-poor banks in Europe with outdated business models posed a threat to the financial system.

But at a news conference Wednesday to discuss the study’s findings, IMF officials charged with gauging financial stability risks worldwide showed no such reluctance.

“The focus of investors has shifted from the level of capital to the business model, and that is why banks are under pressure,” said Peter Dattels, deputy director in the IMF’s capital markets division.

In their report, IMF economists argued that the problems with European banks were deeply structural: a toxic brew of low levels of capital, troubled loans and business models that no longer delivered profits in an era of low growth and negative interest rates.

In particular, Dattels said, “Banks are transitioning from outdated business models that rely on large-scale balance sheets,” saying that Deutsche Bank fell into this bucket.

Economists and regulators have argued that Deutsche Bank, given its size and culture of risk-taking, poses more of a risk to financial markets than its peers in Europe and the United States.

This year, the IMF said in a report on the German financial sector that Deutsche Bank appeared to be the riskiest bank in terms of threats posed to global financial system — an insight that prompted a sharp fall in the bank’s stock.

On Wednesday, fund officials did not backtrack from this view.

“That report highlighted that Deutsche Bank is of systemic importance,” Dattels said. “We are confident that authorities are monitoring this.”

Dattels emphasized that the fund’s models showed that an economic recovery would not ease these problems — drastic overhauls of these banks were also needed.

The tough message contrasts starkly with what Deutsche Bank officials have been telling investors and regulators in recent weeks.

What drove the share price down had less to do with Deutsche’s business model and everything to do with concerns about a huge fine that would stem from the bank’s role in the sale of risky mortgages before the financial crisis, Deutsche Bank officials have said. The U.S. Justice Department has proposed that the bank pay $14 billion to settle the case.

Such an argument is not falling upon sympathetic ears — in Washington or Berlin.

On Tuesday, Sigmar Gabriel, a powerful German politician who leads the minority party in Chancellor Angela Merkel’s coalition government, put into words what many critics of the bank have been wondering for some time now.

“I don’t know whether to laugh or be angry that the bank that declared speculation to be its business model now declares itself a victim of speculators,” Gabriel said to reporters.

Catering to hedge funds is a major business for Deutsche Bank, and bank officials have blamed hedge funds that are betting against the stock for its plummeting share price.

Responding to a question about the size of the proposed penalty, Matthew Jones, a member of the IMF’s financial stability team, said it was not the fine that was the problem but the question of underlying profitability, compensation and capital levels at institutions like Deutsche Bank.

The goal of all regulators now is to “create a culture of responsible finance,” he said

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Re: Banks
« Reply #39 on: October 07, 2016, 06:51:47 AM »

BANKING   DB turned speculation into a business model
German Minister: Deutsche Bank is madness
1STAFF WRITER ▼ | Monday October 3, 2016 3:00AM ET
Sigmar GabrielGerman Economy Minister Sigmar Gabriel lashed out at Deutsche Bank's handling of its problems, saying "irresponsible" managers had put thousands of jobs at risk.

The scenario is that thousands of people will lose their jobs. "I don't know whether to laugh or cry that the bank, which turned speculation into a business model, is now calling itself a victim of it," Gabriel told reporters, after CEO John Cryan this week blamed speculators for pushing the embattled lender's share price to a record low.

READ MORE Minister: China-Germany economic cooperation in good momentum

Speaking to reporters on his way to Tehran for a trade visit, Gabriel said Deutsche's woes could be traced back to past mistakes made by the management.

"The scenario is that thousands of people will lose their jobs. They now have to bear the responsibility for the madness carried out by irresponsible managers," said Gabriel, who is also Germany's vice-chancellor and leader of the Social Democrats, the junior partner in the coalition government.

Deutsche Bank has found itself at the centre of a storm ever since the US Department of Justice last month demanded an unaffordable $14 billion fine over the bank's role in the subprime mortgage crisis. Fears over Deutsche's financial health and speculation that it might need a bailout sent its shares plummeting this week.

Its stock recovered on Friday on a report that the bank was close to a settlement with US authorities to lower the fine to $5.4 billion.

Offline zuolun

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Re: Banks
« Reply #40 on: October 09, 2016, 02:47:36 PM »
Deutsche Bank is on the verge of collapse: Andrew Hoffman ~ 8 Oct 2016

Finance leaders issue fresh warnings amid Deutsche worries, pound rout ~ 8 Oct 2016

Dutch lender ABN Amro exploring sale of Asia private-banking business ~ 8 Oct 2016

Dollar poised for Fed-led rally as election fog clears ~ 8 Oct 2016
  • Greenback index reaches two-month high amid economic optimism
  • Bets for higher rates rise even as jobs data trail estimates

Ringgit weakens to RM4.15 against greenback despite higher oil price ~ 7 Oct 2016

Bank Negara’s international reserves at RM405bil (US$97.7bil) ~ 7 Oct 2016

Switzerland pressures Malaysia over 1MDB 'Ponzi scheme' ~ 5 Oct 2016
In January 2016, 1MDB’s debts ballooned from Rm5 billion to Rm50 billion.

Payment performance of Singaporean companies declined strongly in Q3, 2016 ~ 4 Oct 2016

NYC's dirty money files ~ 3 Oct 2016

Authorities say Low headed Good Star Ltd, a company that received a massive $1.03 billion from the fund. So it’s not surprising he was able to drop so much cash on real estate, art and partying in New York. He allegedly moved money between accounts in Singapore, Switzerland and New York “in a manner intended to conceal” the origin of the money.

Singapore urged to step up policing of financial crime ~ 27 Sep 2016

Why Asia’s dollar squeeze is different this time ~ 26 Sep 2016
Unlike 3 years ago, the banking system most exposed to tight hard-currency funding conditions isn’t India. It’s Malaysia. And that's probably one reason investors are nervous about the nation's banking stocks:

Dollar Libor has since surged to as much as 0.87%. Indian banks can borrow the U.S. currency at just 0.39%, a discount to Libor. If there's truly a dollar-funding crunch for banks in the region ex-Japan, it's in Malaysia, where 3-month dollar borrowing is as expensive as 1.44%. The timing couldn't be worse. Several countries are investigating allegations of theft and laundering of billions of dollars from 1MDB.

Loans to households in Malaysia higher than GDP: Allianz Wealth Report ~ 22 Sep 2016
The 7.2% growth in loans to the households exceeded the GDP of 4.6% growth and even their financial assets with 4.9% “thus worsening the private debt to GDP ratio and asset to debt ratio further.

Assessing the investment climate in post-1MDB Malaysia ~ 6 Sep 2016

Malaysia still far from the 55% debt limit — MIDF Research ~ 9 Jun 2016]

Malaysia govt had RM20.31b ((US$5.2b) exposure to 1MDB as of Oct 2015 ~ 8 Apr 2016

1MDB owes RM5bil to local financial institutions, says Government ~ 27 Mar 2015

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Re: Banks
« Reply #41 on: October 10, 2016, 04:21:51 PM »
US elections a wildcard for KLCI in fourth quarter 2016 ~ 10 Oct 2016

US Ambassador Joseph Yun gives cautious reminder about DoJ suit ~ 8 Oct 2016

ANZ’s Shayne Elliott: Lending to the Oswals was a mistake ~ 6 Oct 2016
Mr Elliott also attempted to distance the bank from a Malaysian political scandal in which about US$1 billion allegedly looted from the country’s sovereign wealth fund 1MDB passed through a bank account held by Prime Minister Najib Razak at Ambank, which is 25% owned by ANZ.

AMBank ~ Hit a new record low as at 5 Oct 2016
When a stock is in a bear-market territory, the last low will be retested and the share price will move much further down, forming a new record low.

Sarawak Report - Editor Clare Rewcastle Brown interview ~ 29 Sep 2016

Bank Negara urged to probe Ambank over Najib's account ~ 14 Sep 2016

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Re: Banks
« Reply #42 on: October 10, 2016, 05:18:32 PM »
RHBBank (1066) ~ Intermediate uptrend is broken, downside bias

RHBBank closed with a doji @ RM4.63 (+0.03, +0.7%) with 1m shares done on 7 Oct 2016.

Immediate support @ RM4.42, immediate resistance @ RM4.70.

Singapore charges two ex-bankers in Jho Low, 1MDB-linked case ~ 10 Oct 2016
  • Yak, Seah face seven charges each from Singapore authorities
  • Two charged Monday in city state are ex-BSI employees
Malaysia banks lag Southeast Asian peers on 1MDB, slow growth ~ 11 Aug 2016

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Re: Banks
« Reply #43 on: October 16, 2016, 09:09:36 AM »
PBBANK (1295) ~ Trading in an upward sloping channel

PBBANK closed with a gravestone doji @ RM19.72 (-0.02, -0.1%) with 4.43m shares done on 14 Oct 2016.

Immediate support @ RM19.70, immediate resistance @ RM19.95.

PBBANK (weekly) ~ Blue-sky breakout

Public Bank upsizes debt notes programme ~ 28 Sep 2016

Spot the Dollar squeeze difference ~ 28 Sep 2016
  • Unlike 3 years ago, the banking system most exposed to tight hard-currency funding conditions isn’t India. It’s Malaysia. And that's probably one reason investors are nervous about the nation's banking stocks.
  • Dollar Libor has since surged to as much as 0.87%. Indian banks can borrow the U.S. currency at just 0.39%, a discount to Libor. If there's truly a dollar-funding crunch for banks in the region ex-Japan, it's in Malaysia, where 3-month dollar borrowing is as expensive as 1.44%. The timing couldn't be worse. Several countries are investigating allegations of theft and laundering of billions of dollars from 1MDB.
  • Malaysian banks' deposit growth has stalled, led by a 10% decline in foreign-currency deposits so far this year.

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Re: Banks
« Reply #44 on: October 24, 2016, 02:53:29 PM »
EPF says seeking RM1.28 bil loan to protect against forex risks

October 20, 2016

The Employees Provident Fund says its subsidiary Kwasa Global is negotiating for a loan of RM1.28 billion with two banks to refinance its assets in the United Kingdom to help protect against volatilities in foreign currency and exchange rates.

In a statement this evening, the EPF also clarified that the loan amount, which Kwasa Global is negotiating for with Standard Chartered and DBS Bank, is not RM12 billion.

It was responding to a WhatsApp message being circulated earlier today, which stated that the EPF was seeking financing from the two banks.

"All investment decisions made by the EPF are in accordance with our risk-return profile, in line with ensuring that members’ retirement savings are safe and well managed," it said.

"Offshore financing reduces the foreign currency exposure of the global real estate investment and, therefore, is part of investment best practice. The deal is being undertaken through our subsidiary Kwasa Global and is still under negotiation, though the loan amount involved is RM1.28 billion, and not RM12 billion as has been stated in the WhatsApp," it added.

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Re: Banks
« Reply #45 on: November 02, 2016, 08:01:59 AM »
Former 1MDB subsidiary SRC International in financial trouble: Malaysian minister ~ 1 Nov 2016
Malaysia's second finance minister Datuk Johari Abdul Ghani admits SRC International faces problem in recovering fund frozen in BSI. Investment still there although Spore branch shut.

Ex-BSI banker trial: Yeo Jiawei's former supervisor made S$6.9m in 'secret profits' from 1MDB dealings ~ 1 Nov 2016

China Construction Bank (M) receives commercial banking licence in Malaysia ~ 1 Nov 2016

China EximBank pledges $3.5bn to 10 Chinese and international companies ~ 31 Oct 2016

Singapore's DBS pounces on ANZ assets to extend Asia private banking push ~ 31 Oct 2016

Singapore DBS Q3 net profit little changed, bad debt charges swell ~ 31 Oct 2016

Is global banks’ exposure to global shipping being neglected by markets? ~ 29 Oct 2016

UOB third-quarter profit falls 7.8% as bad debt charges jump ~ 28 Oct 2016

Private banks book weak loan growth in Sept as bad loans rise ~ 27 Oct 2016

Perisai Petroleum on edge as winding up order lands and banks come knocking ~ 27 Oct 2016
Adding to Perisai’s woes, a 51% owned subsidiary, SJR Marine has defaulted on a financing facility provided by OCBC Al-Amin Bank. The bank is seeking immediate repayment of $20.5m.

Stresses for Singaporean energy firms deepening, OCBC CEO says ~ 27 Oct 2016

Singapore's Oversea-Chinese Banking profit up 5%; bad debts swell

By Tomomi Kikuchi, Nikkei staff writer
October 27, 2016

SINGAPORE -- Oversea-Chinese Banking Corp., Singapore's second-largest bank by assets, said Thursday its net profit rose 5% on the year to 943 million Singapore dollars ($677 million) for the third quarter ending in September.

Despite a drop in the bank's net interest margin and higher provisions for bad loans, its bottom line was lifted by better performance in its wealth-management business and its Indonesian unit.

Net interest income for the quarter dropped 6% to S$1.23 billion, pressured by weak loan demand and a thinner net interest margin, which fell to 1.62% from 1.66% a year earlier. Loan volume was down 2% on year at S$208.6 billion, mainly due to weaker trade-related lending to greater China.

Noninterest income grew 25% to S$970 million. The bank's wealth-management business accounted for 28% of income, with its fee income hitting a record-high S$155 million. The Indonesian unit's contribution to overall net profit grew 34% on year to S$36 million.

While the financial results for the quarter beat analysts' expectations, OCBC maintained a cautious outlook on the regional economy. "The market environment continues to be difficult," said CEO Samuel Tsien at a news conference Thursday morning.

OCBC's asset quality is also showing signs of deterioration. It had S$2.47 billion of nonperforming loans as of September, up from S$1.86 billion a year ago. That pushed the bad loan ratio up to 1.2% from 0.9% during the same period a year earlier. The bank booked S$421 million in loan-loss provisions and impairments in the first nine months of the year, up 43% from S$294 million for the same period in 2015.

The main culprit is the ailing oil and gas exploration sector, which makes up around 6% of OCBC's loans. The industry made up around one-third of specific allowances booked in the third quarter. "I don't think the oil and gas sector is in a recovery mode yet," said Tsien.

Earlier this month, Fitch Ratings released a report on the impact of oil- and gas-related defaults on Singaporean banks. While the report concluded the city-state's banks are "well-placed to withstand potential losses," it said the weighted-average nonperforming loan ratio for the three biggest banks -- DBS Group Holdings, OCBC and United Overseas Bank -- is expected to rise as more bad loans emerge from the sector.

As the city-state's economy suffers the side effects of weak global trade demand stemming from a slowdown in China, Tsien said Singapore's consumer-oriented sectors, such as retail and food and beverage services, may also come under pressure.

The bank expects loan growth for the full year and 2017 to be in the "low single digits." To compensate for the weak domestic economy, OCBC plans to use its international franchise to provide capital for businesses expanding in Southeast Asia and China. Tsien said OCBC's ability to compete against its peers is "strengthened rather than weakened" when the domestic economy is sluggish, as it can service more companies venturing overseas for growth.

Bank of China Q3 profit up 2.4% as margins shrink, NPLs rise ~ 26 Oct 2016

Bad loan charges to hit Singapore's three biggest banks ~ 25 Oct 2016

Singapore banks missing the boat in booming SE Asia ~ 13 Oct 2016

Lloyds Banking Group cuts 1,200 jobs in drive to reduce branch network ~ 12 Oct 2016

Malaysian banks brace for profit hits as O&G firms restructure debt ~ 26 Sep 2016

Bad loans to shipping: That sinking feeling ~ 3 Sep 2016
Banks continue to count the cost of shipping’s troubles

Sinking feeling for Korean banks ~ 15 Jun 2016

Korean banks set to suffer from exposure to troubled shipbuilders ~ 25 May 2016

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Re: Banks
« Reply #46 on: November 21, 2016, 10:35:17 AM »
Move over, London and Berlin, Singapore’s fintech ecosystem is surging ahead ~ 21 Nov 2016

Central banks look to the future of money with blockchain technology trial ~ 21 Nov 2016

Four city contenders for London's 'Fintech Capital of Europe' crown ~ 20 Nov 2016

Singapore to test digital currency in latest fintech initiative ~ 16 Nov 2016
  • MAS working on interbank payments blockchain, MD Menon says
  • Stock exchange, eight banks, R3 group involved: Menon
Hong Kong central bank flags blockchain money-laundering risk ~ 11 Nov 2016
  • Anonymity raises risk of illegal activity: HKMA report
  • HKMA unveiled fintech hub, regulatory sandbox in September

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Re: Banks
« Reply #47 on: February 04, 2017, 10:36:39 AM »
Bad debt worries cast a shadow on banks in Malaysia, Singapore

By Kevin Lim and Jason Ng
February 2, 2017

Singapore -- Concerns about asset quality are clouding the outlook for banks in Malaysia and Singapore even as lending shows signs of stability.

In Malaysia, outstanding loans in the banking system grew 5.3% in 2016, its slowest pace in at least 10 years, according to data from the central bank. That compares to 7.9% annual growth in 2015. On a monthly basis, the pace of loan growth pace was steady at 5.3% in December.

In Singapore, data released by the Monetary Authority of Singapore earlier this week showed bank lending rose 0.5% in December from a year ago, the first year-on-year increase following 11 months of contraction. The percentage increase is based on changes in the value of loans by the domestic banking units of Singapore-based lenders as well as loans extended to offshore borrowers.

Banks in both countries have been whacked by domestic and external factors.

Singapore's trade-dependent economy has been in the doldrums for the past two years amid a slowdown in global trade as well as weakness in key sectors such as rig building and energy and commodities. In December, ratings agency Moody's Investors Service downgraded the subordinate debt of the three local banks as it expects a further deterioration in asset quality this year.

In Malaysia, bank lending has been under pressure for the past five years after Bank Negara Malaysia tightened rules to rein in ballooning household debt. A slowing economy and rising cost of living have also weighed as consumers and businesses delay or scrap big-ticket purchases.

Malaysian household confidence slipped further in the final quarter of 2016 with the Consumer Sentiments Index declining four points to 69.8.

Consumers gave a "decidedly more negative assessment of their near-term finances," said Malaysian Institute of Economic Research, a state-backed think tank, which compiled the index.

Public Bank, Malaysia's third-largest by assets, said Thursday in a filing to the stock exchange: "The challenging operating environment for businesses and higher cost of living for households will impact the banking system's earnings and asset quality moderately in 2017."

The bank reported a 0.6% decline in fourth-quarter net profit.

Analysts in Kuala Lumpur said indicators in the form of loan approvals and applications signal that banks' lending activity will likely remain tepid this year.

"Our base case estimate for the system loan growth for 2017 is in the range of 5.0%-5.5%," said Kenanga Investment Bank's analyst Ahmad Ramzani Ramli. "There are limited opportunities to drive earnings growth for the industry materially beyond our current expectation of a mid-to-high single-digit growth."

Affin Hwang Investment Bank's Analyst Tan Ei Leen said, "It is unlikely that loan growth in 2017 would be stronger than 2016."

"We believe that the shift to the corporate bond market, poor consumer sentiment and cautious lending will continue to mitigate credit growth in 2017," Tan said.

In Singapore, stockbroking firm Maybank Kim Eng said in a report Thursday that the increase in December lending in the city-state was partly due to the low base of comparison.

The firm also pointed to data that showed a worsening in asset quality, with the percentage of loans classified as doubtful or worse at its highest level since the fourth quarter of 2009.

According to MAS, banks' total exposure in the fourth quarter of 2016 had a pass rate of 96.09%, down from 96.22% in the third quarter. This meant that just under 4% of bank loans had been placed in the special mention, substandard, doubtful or loss categories.

The pass rate was 96.67% in the fourth quarter of 2015.

"Our view is Singapore banks are likely to report higher provisions to cover rising NPLs (non-performing loans)," Maybank Kim Eng analyst Ng Li Hiang said in a note to clients.

Maybank Kim Eng also pointed out that the consumer loan growth of 0.2% in December was the slowest since September 2009.

The brokerage has a "negative" outlook on the Singapore banking sector with "hold" recommendations for DBS Group Holdings and United Overseas Bank and a "sell" on Oversea-Chinese Banking Corporation.

However, there is some optimism that the turnaround in Singapore's bank lending could hold if the domestic economy continues to improve.

Manufacturing output surged 21.3% in December from a year ago, helped by a spike in shipments of semiconductors due to higher technology spending in the U.S. and a restocking of components by companies in China, Singapore's biggest market.

Citigroup said on Thursday that its Electronic Leading Index suggests Asia's tech restocking will extend into the first quarter of 2017, and that this is corroborated by strong technology exports from South Korea in January.

DBS said it expects business loan growth in Singapore will continue to strengthen in coming months along with the steadily improving business climate, but consumer loans will remain sluggish as household debt levels remain relatively high.

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Re: Banks
« Reply #48 on: March 12, 2017, 02:44:58 PM »
Scotiabank in talks with Cathay Financial to sell Malaysia unit ~ 10 Mar 2017

Cathay Financial in talks to acquire bank in Malaysia

March 9, 2017

Taipei -- Cathay Financial Holding Co. (國泰金), one of the largest financial holding companies in Taiwan, said Thursday that it has started exclusive talks to acquire the Canada-based Bank of Nova Scotia's banking assets in Malaysia.

The Canadian bank announced last year that it was disposing of all of its subsidiary -- Bank of Nova Scotia Berhad -- as part of a plan to scale back its operations in Asia, and was seeking a suitor.

In a statement Cathay Financial filed with the Taiwan Stock Exchange, the Taiwanese financial firm said the talks with the Canadian bank for the acquisition will continue until the end of April.

Cathay Financial said that if the talks proceed smoothly, the acquisition plan will be carried out by its 100 percent-owned subsidiary, Cathay United Bank (國泰世華). Cathay United Bank is expected to become the first Taiwanese bank to own a subsidiary in Malaysia, it said.

Local media reported that the Bank of Nova Scotia Berhad, headquartered in Kuala Lumpur, has more than US$1 billion in assets with a net worth of about US$300 million. The Malaysian subsidiary specializes in corporate banking.

Market analysts said that since the financial authorities in Malaysia keep a tight grip on the country's banking business by controlling the issuance of licenses for banks to set up branches or subsidiaries, foreign banks have to use acquisition deals to enter the market.

Currently, Cathay United Bank runs a branch in Labuan, a federal territory of Malaysia, but since the location is remote, the Taiwanese bank aims to extend its reach to Kuala Lumpur in a bid to seek more business opportunities in Malaysia, analysts said.

The Labuan branch focuses on foreign currency trading but is not allowed to conduct Malaysian Ringgit-denominated transactions, analysts said, adding that if the deal to buy the Bank of Nova Scotia Berhad is successful, Cathay United Bank is expected to conduct Ringgit-denominated business in the Malaysiaa market.

Analysts said that Cathay Financial is expected to use funds provided by Cathay United Bank and Cathay Life Insurance Co. (國泰人壽), the flagship entity of the financial holding firm, to finance the acquisition. In Taiwan, many life insurers, such as Cathay Life, are sitting on large cash assets and are eager to find investment tools. The deal to acquire the Bank of Nova Scotia Berhad will provide a good channel for Cathay Life to park its money.

However, Cathay Financial did not disclose any details about the financial terms under the acquisition deal.

Outside Malaysia, Cathay Financial owns a stake of about 25 percent in Bank Mayapada in Indonesia and the Philippines' Rizal Commercial Banking Corp (RCBC).

The pace of Taiwanese banks extending their footholds in Malaysia has been slow. Last year, CTCB Financial Holding Co. (中信金) dropped a plan to acquire the assets of Royal Bank of Scotland Group Plc (RBS) in Malaysia due to a failure to secure regulatory approval.

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Re: Banks
« Reply #49 on: March 12, 2017, 03:22:51 PM »
The banking industry started with a promising loan growth for 2017, advancing by 30 basis points (bps) to 5.6% at RM1.53 billion or 0.4% month-on-month (m-o-m) driven by household loans at +6% year-on-year (y-o-y).

 Business loans saw improvements with December 2016 and January 2017 growths at 4.5% y-o-y and 5.2% y-o-y.