Showing posts with label Sector-Banking. Show all posts
Showing posts with label Sector-Banking. Show all posts
4.04.2011
Asia/Europe - 04/01/11
Asia / Europe (47.4% of asset mix) (with net present value in 1 year) 1. China Mobile (0941/CHL) HK$101.2 STRONG BUY 2. China Life (2628/LFC) HK$41.5 STRONG BUY 3. China Construction Bank (0939) HK$9.0 => HK$9.1 BUY 4. Total SA (TOT) US$61.6 HOLD 5. Siu On Land (0272) HK$6.7 => HK$6.5 STRONG BUY 6. HSBC Holding (0005/HBC) US$67.3 => US$63.3 BUY 7. IFSE A50 China Fund (2823) HK$22.4 STRONG BUY · Mar 11 major transactions: add Honda Motor (HMC) US$36.93; add MTR (0066) HK$29.1; add China Resource Power (0836) HK$13.0 · China Construction Bank 4q10 press release · 2010 net income up 26% to RM$135B compare to 2009, given 1. Net interest income up 19% to RM$252B 2. Fee income up 38% to RM$66B 3. Expenses & impairment up 15% to RM$121B & $29B 4. P/E ratio as of Mar 31, 2011 equal to 11.3 (looks reasonable, but with such high growth rate, the P/E ratio are low) · 2010 deposit from customers up 13% while loan to customer up 18% & loan to deposit ratio up 2% to 62% (very healthy or overly healthy compare to lots of global peers · 2010 book value up 10% to RM$2.8, price to book ratio 2.25 (slightly higher, but reasonable given the high growth rate) · Change NPV to HK$9.1, with a conservative 15% growth rate in earnings and 10% increase in RMB and assume P/E of 10 & BV of 1.6 in 5 years time and discount rate of 25%. # Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant. · STRONG BUY with NPV over MV above 30% · BUY btw 15% to 30% · HOLD btw (15%) to 15% · RE-RE-RECONSIDER below (15%)
3.07.2011
Top Holding - US/Canada
1. Manulife Financial (MFC) CA$31.4 STRONG BUY
2. Google Inc. (GOOG) US$745.1 BUY
3. Wells Fargo Financial (WFC) US$41.1 => US$43.8 STRONG BUY
4. General Electric (GE) US$19.7 => US$23.5 HOLD
5. TD Bank (TD) CA$83.8 => CA$92.3 HOLD
6. American Express (AXP) US$48.6 HOLD
7. Imperial Oil (IMO) CA$47.8 HOLD
· Mar 11 major transactions: add Berkshire Hathaway (BRK.B) US $85.0; add American Express (AXP) US$43.2
· TD Bank report great results!! Compare to 1q10:
· 1q11 adjusted EPS up 8% to CA$1.74; net interest income up 11%, fee income up 5%, loan provision down by 20%, book value down up slightly by 3%
· 1q earnings usually the highest among all quarters (cuz more investment & underwriting activities) so I don’t think this result will repeat in 2q-4q
· As interest rate may rise in 2H2011, it may hurt TD’s interest margin
· Regulatory change on mortgage (from 35 year to 30 year start from Apr 11) may hurt real estate market’s activities, but should have no impact on TD’s interest income
· Even the interest rate may rise & higher gas price offset with the lower unemployment rate & slow economy pick up, I think loan provision will stay flat for 2011 compare to 2010
· 2011 adjusted EPS expectation is CA$6.46
· Great reminder from Warren Buffett in 2010 annual report: http://bilibala-life.blogspot.com/
# Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant.
· STRONG BUY with NPV over MV above 30%
· BUY btw 15% to 30%
· HOLD btw (15%) to 15%
· RE-RE-RECONSIDER below (15%)
2. Google Inc. (GOOG) US$745.1 BUY
3. Wells Fargo Financial (WFC) US$41.1 => US$43.8 STRONG BUY
4. General Electric (GE) US$19.7 => US$23.5 HOLD
5. TD Bank (TD) CA$83.8 => CA$92.3 HOLD
6. American Express (AXP) US$48.6 HOLD
7. Imperial Oil (IMO) CA$47.8 HOLD
· Mar 11 major transactions: add Berkshire Hathaway (BRK.B) US $85.0; add American Express (AXP) US$43.2
· TD Bank report great results!! Compare to 1q10:
· 1q11 adjusted EPS up 8% to CA$1.74; net interest income up 11%, fee income up 5%, loan provision down by 20%, book value down up slightly by 3%
· 1q earnings usually the highest among all quarters (cuz more investment & underwriting activities) so I don’t think this result will repeat in 2q-4q
· As interest rate may rise in 2H2011, it may hurt TD’s interest margin
· Regulatory change on mortgage (from 35 year to 30 year start from Apr 11) may hurt real estate market’s activities, but should have no impact on TD’s interest income
· Even the interest rate may rise & higher gas price offset with the lower unemployment rate & slow economy pick up, I think loan provision will stay flat for 2011 compare to 2010
· 2011 adjusted EPS expectation is CA$6.46
· Great reminder from Warren Buffett in 2010 annual report: http://bilibala-life.blogspot.com/
# Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant.
· STRONG BUY with NPV over MV above 30%
· BUY btw 15% to 30%
· HOLD btw (15%) to 15%
· RE-RE-RECONSIDER below (15%)
1.19.2011
Wells Fargo 4q10 earning release
Bilibala: 4q10 EPS $0.61 sightly off than what I expected $0.63. Mainly because its net interest income $11.1B looks flat compare to 3q10. While loan provision down further by 14% to 3.0B, its non interest expenses also move up to 13.3B or 8%. Excluded the 0.4B of the expense related to a 3 years charible donation, expenses up 5%, still higher than expected.
To Bilibala, i think Wells Fargos price over book ratio 1.38 is higher than peers, and since price move up from around $25 (3 months ago) to $32 now, I will change my recommendation from Strong Buy to Buy.
http://www.reuters.com/article/idUSTRE70I3FN20110119?feedType=nl&feedName=usbusinessearly
(Reuters) - Wells Fargo & Co (WFC.N) and U.S. Bancorp (USB.N) said low interest rates were squeezing lending profits, but improving credit quality helped both banks post higher fourth-quarter earnings.
Analysts and investors shrugged off the bottom-line figures and focused on the impact of low interest rates and a reluctance by businesses to tap their credit lines.
"It's a mixed bag looking at these banks," said analyst Shannon Stemm of Edward Jones in St. Louis. "There's improving fee income, but loan demand and interest income still remains weak."
Shares of Wells Fargo, the No. 4 U.S. bank by assets, fell 2 percent to $31.81, while U.S. Bancorp, the fifth-largest U.S. commercial bank, fell 2.9 percent to $26.52.
The banking industry is making more new loans to consumers and businesses.
U.S. Bancorp said average total loans increased 2 percent from a year earlier, and Wells Fargo said total loans grew 0.4 percent from the third quarter.
Analysts and economists have said an uptick in business borrowing is a key cog in the continuing economic recovery. But early fourth-quarter figures suggest businesses -- while taking out new loans -- are hesitant to use them.
U.S. Bancorp said companies were getting credit lines from the bank, but were not actively borrowing on them.
Commercial line utilization -- or the amount of money businesses borrowed under available credit -- fell to 26 percent in fourth quarter, an all-time low and down from 30 percent in the third quarter.
"We're looking forward to the day usage goes up," U.S. Bancorp Chief Executive Officer Richard Davis said on a conference call with analysts.
ASSET QUALITY
Analysts said that despite the slow loan growth, banks' balance sheets were beginning to show signs of health after three years of crisis and recession.
"The banks are building a foundation back to normal earnings," said Guggenheim Securities LLC analyst Marty Mosby. "Right now, asset quality has to get healthy, and that's happening at a much faster rate than I think a lot of us expected."
Wells Fargo's fourth-quarter profit increase stemmed in part from the release of $850 million in loan loss reserves, as the bank said its problem loans continued to shrink. Net charge-offs declined 29 percent from a year earlier.
U.S. Bancorp released $25 million in loan loss reserves during the period, the company's first such move since 2008.
Citigroup (C.N) also took a large reserve release in the fourth quarter, raising concerns among analysts about the quality of its results.
MARGIN PRESSURE
But improving credit did not offset the squeeze in net interest margin, or the money a bank receives in interest from loans against what it pays for deposits.
As the Federal Reserve continues to hold U.S. interest rates at record low levels, banks have little leeway on what they charge for loans and what they pay out for deposits.
Heading into 2011, both U.S. Bancorp and Wells Fargo said net interest margins would remain stagnant or shrink.
Davis said U.S. Bancorp's net interest margin of 3.83 percent, which declined from 3.91 percent in third quarter, would continue to contract at the same rate in the first three months of 2011.
Wells Fargo's net interest margin also shrank, to 4.16 percent from 4.25 percent in third quarter.
The bank posted a 21 percent increase in fourth-quarter profit to $3.4 billion, or 61 cents a share, meeting analysts' expectations, according to Thomson Reuters I/B/E/S.
U.S. Bancorp posted a 61 percent jump in net income. Earnings per share of 49 cents beat the analysts' average estimate by 3 cents.
Hudson City Bancorp (HCBK.O) and Fifth Third Bancorp (FITB.O) also reported results on Wednesday.
Hudson City beat expectations, but warned that net interest margins in 2011 may decline from fourth-quarter levels. Hudson shares sank 8.5 percent.
Fifth Third beat analysts' expectations, as delinquencies hit their lowest level in nearly four years. The bank also said it would launch a stock offering and use the proceeds to repay the aid it received under the government's Troubled Asset Relief Program.
(Reporting by Joe Rauch and Jonathan Spicer; writing by Ben Berkowitz and Joe Rauch; Editing by Lisa Von Ahn, John Wallace, Phil Berlowitz)
To Bilibala, i think Wells Fargos price over book ratio 1.38 is higher than peers, and since price move up from around $25 (3 months ago) to $32 now, I will change my recommendation from Strong Buy to Buy.
http://www.reuters.com/article/idUSTRE70I3FN20110119?feedType=nl&feedName=usbusinessearly
(Reuters) - Wells Fargo & Co (WFC.N) and U.S. Bancorp (USB.N) said low interest rates were squeezing lending profits, but improving credit quality helped both banks post higher fourth-quarter earnings.
Analysts and investors shrugged off the bottom-line figures and focused on the impact of low interest rates and a reluctance by businesses to tap their credit lines.
"It's a mixed bag looking at these banks," said analyst Shannon Stemm of Edward Jones in St. Louis. "There's improving fee income, but loan demand and interest income still remains weak."
Shares of Wells Fargo, the No. 4 U.S. bank by assets, fell 2 percent to $31.81, while U.S. Bancorp, the fifth-largest U.S. commercial bank, fell 2.9 percent to $26.52.
The banking industry is making more new loans to consumers and businesses.
U.S. Bancorp said average total loans increased 2 percent from a year earlier, and Wells Fargo said total loans grew 0.4 percent from the third quarter.
Analysts and economists have said an uptick in business borrowing is a key cog in the continuing economic recovery. But early fourth-quarter figures suggest businesses -- while taking out new loans -- are hesitant to use them.
U.S. Bancorp said companies were getting credit lines from the bank, but were not actively borrowing on them.
Commercial line utilization -- or the amount of money businesses borrowed under available credit -- fell to 26 percent in fourth quarter, an all-time low and down from 30 percent in the third quarter.
"We're looking forward to the day usage goes up," U.S. Bancorp Chief Executive Officer Richard Davis said on a conference call with analysts.
ASSET QUALITY
Analysts said that despite the slow loan growth, banks' balance sheets were beginning to show signs of health after three years of crisis and recession.
"The banks are building a foundation back to normal earnings," said Guggenheim Securities LLC analyst Marty Mosby. "Right now, asset quality has to get healthy, and that's happening at a much faster rate than I think a lot of us expected."
Wells Fargo's fourth-quarter profit increase stemmed in part from the release of $850 million in loan loss reserves, as the bank said its problem loans continued to shrink. Net charge-offs declined 29 percent from a year earlier.
U.S. Bancorp released $25 million in loan loss reserves during the period, the company's first such move since 2008.
Citigroup (C.N) also took a large reserve release in the fourth quarter, raising concerns among analysts about the quality of its results.
MARGIN PRESSURE
But improving credit did not offset the squeeze in net interest margin, or the money a bank receives in interest from loans against what it pays for deposits.
As the Federal Reserve continues to hold U.S. interest rates at record low levels, banks have little leeway on what they charge for loans and what they pay out for deposits.
Heading into 2011, both U.S. Bancorp and Wells Fargo said net interest margins would remain stagnant or shrink.
Davis said U.S. Bancorp's net interest margin of 3.83 percent, which declined from 3.91 percent in third quarter, would continue to contract at the same rate in the first three months of 2011.
Wells Fargo's net interest margin also shrank, to 4.16 percent from 4.25 percent in third quarter.
The bank posted a 21 percent increase in fourth-quarter profit to $3.4 billion, or 61 cents a share, meeting analysts' expectations, according to Thomson Reuters I/B/E/S.
U.S. Bancorp posted a 61 percent jump in net income. Earnings per share of 49 cents beat the analysts' average estimate by 3 cents.
Hudson City Bancorp (HCBK.O) and Fifth Third Bancorp (FITB.O) also reported results on Wednesday.
Hudson City beat expectations, but warned that net interest margins in 2011 may decline from fourth-quarter levels. Hudson shares sank 8.5 percent.
Fifth Third beat analysts' expectations, as delinquencies hit their lowest level in nearly four years. The bank also said it would launch a stock offering and use the proceeds to repay the aid it received under the government's Troubled Asset Relief Program.
(Reporting by Joe Rauch and Jonathan Spicer; writing by Ben Berkowitz and Joe Rauch; Editing by Lisa Von Ahn, John Wallace, Phil Berlowitz)
1.14.2011
JPMorgan profit rises 47 percent, beating estimates
Bilibala: I haven't read through JP Morgan's financial release yet, but improvement in bank performance to me is kind of expected, that's why the stock price do not have a big jump after the news.
With QE2.0 the issue is not lack of cash, but too many funding with no where to invest: T-bill earning almost zero? lead out to ppl who are not credit worthy? invest in commodities? or what?
http://www.reuters.com/article/idUSTRE70D2BM20110114?feedType=nl&feedName=usbusinessearly
(Reuters) - JPMorgan Chase & Co reported a 47 percent increase in quarterly earnings, but much of the gain came from dipping into money previously set aside to cover bad loans.
The gradually recovering U.S. economy is allowing JPMorgan to keep less money on hand for loan losses. Profit and revenue was stronger than analysts had expected, and the bank made more loans.
But JPMorgan is still wrestling with the aftermath of the mortgage crisis -- it set aside another $1.5 billion to cover legal settlements mainly linked to U.S. home loan foreclosures.
"Hopefully it's going to be a good year," said JPMorgan Chief Executive Jamie Dimon on a conference call with journalists, adding that the economy looks better now than it did 12 months ago.
JPMorgan shares rose 10 cents to $44.55 in early trading on the New York Stock Exchange.
Analysts said the results could indicate headwinds for major banks reporting next week. The largest U.S. bank, Bank of America Corp, reports on Friday January 19, while Citigroup, the third largest, reports on Tuesday. Goldman Sachs Group reports on Wednesday.
JPMorgan said profit increased to $4.8 billion, or $1.12 a share, from $3.3 billion, or 74 cents a share, a year earlier. Analysts on average expected $1 a share, according to Thomson Reuters I/B/E/S.
Fewer bad loans meant the bank could reduce loan-loss reserves for its credit card unit by $2 billion, or 30 cents a share after tax.
"The loan-loss reserves are something that bugs me," said Matt McCormick, portfolio manager and banking analyst at Bahl & Gaynor. "I would love to see a bank hit their numbers without taking from loan-loss reserves for once," he added.
Revenue rose 6 percent to $26.7 billion on a managed basis, which adjusts for an accounting change for off-balance sheet entities. That was higher than the $24.37 billion expected by analysts.
HIGHER INVESTMENT BANKING REVENUE
In JPMorgan's investment bank, revenue rose 26 percent to $6.21 billion. Compensation expense per employee for the full year, a measure of how investment banking bonuses will fare, dropped 2.7 percent to $369,651.
Merger advisory revenue fell 31 percent from the fourth quarter 2009 to $424 million, but Chief Financial Officer Douglas Braunstein said revenue in this area should rise in 2011 because of the large number of deals in the pipeline.
Fixed-income trading revenue, at $2.88 billion, was 5 percent higher than the fourth quarter of 2009 but down 8 percent from the third quarter of 2010.
Some analysts expect Goldman Sachs and Morgan Stanley to post 10 percent to 15 percent declines in fixed income trading revenue, so JPMorgan's results could mean the business is not as bad as feared.
The bank benefited from a turnaround in its retail banking unit, which reported a profit of $708 million compared with a loss of $399 million in the year-earlier quarter.
Still, JPMorgan had to put aside $1.5 billion of additional litigation reserves related to soured mortgages it sold to investors and homes it may have improperly foreclosed on.
Bank of America Corp last week agreed to pay $2.8 billion to mortgage finance giants Fannie Mae and Freddie Mac to settle claims that it sold bad home loans to them.
Many investors fear that other banks will have to make similar settlement with the two government-backed entities.
(Additional reporting by Maria Aspan in New York and Dominic Lau in London; Editing by Lisa Von Ahn and Steve Orlofsky)
With QE2.0 the issue is not lack of cash, but too many funding with no where to invest: T-bill earning almost zero? lead out to ppl who are not credit worthy? invest in commodities? or what?
http://www.reuters.com/article/idUSTRE70D2BM20110114?feedType=nl&feedName=usbusinessearly
(Reuters) - JPMorgan Chase & Co reported a 47 percent increase in quarterly earnings, but much of the gain came from dipping into money previously set aside to cover bad loans.
The gradually recovering U.S. economy is allowing JPMorgan to keep less money on hand for loan losses. Profit and revenue was stronger than analysts had expected, and the bank made more loans.
But JPMorgan is still wrestling with the aftermath of the mortgage crisis -- it set aside another $1.5 billion to cover legal settlements mainly linked to U.S. home loan foreclosures.
"Hopefully it's going to be a good year," said JPMorgan Chief Executive Jamie Dimon on a conference call with journalists, adding that the economy looks better now than it did 12 months ago.
JPMorgan shares rose 10 cents to $44.55 in early trading on the New York Stock Exchange.
Analysts said the results could indicate headwinds for major banks reporting next week. The largest U.S. bank, Bank of America Corp, reports on Friday January 19, while Citigroup, the third largest, reports on Tuesday. Goldman Sachs Group reports on Wednesday.
JPMorgan said profit increased to $4.8 billion, or $1.12 a share, from $3.3 billion, or 74 cents a share, a year earlier. Analysts on average expected $1 a share, according to Thomson Reuters I/B/E/S.
Fewer bad loans meant the bank could reduce loan-loss reserves for its credit card unit by $2 billion, or 30 cents a share after tax.
"The loan-loss reserves are something that bugs me," said Matt McCormick, portfolio manager and banking analyst at Bahl & Gaynor. "I would love to see a bank hit their numbers without taking from loan-loss reserves for once," he added.
Revenue rose 6 percent to $26.7 billion on a managed basis, which adjusts for an accounting change for off-balance sheet entities. That was higher than the $24.37 billion expected by analysts.
HIGHER INVESTMENT BANKING REVENUE
In JPMorgan's investment bank, revenue rose 26 percent to $6.21 billion. Compensation expense per employee for the full year, a measure of how investment banking bonuses will fare, dropped 2.7 percent to $369,651.
Merger advisory revenue fell 31 percent from the fourth quarter 2009 to $424 million, but Chief Financial Officer Douglas Braunstein said revenue in this area should rise in 2011 because of the large number of deals in the pipeline.
Fixed-income trading revenue, at $2.88 billion, was 5 percent higher than the fourth quarter of 2009 but down 8 percent from the third quarter of 2010.
Some analysts expect Goldman Sachs and Morgan Stanley to post 10 percent to 15 percent declines in fixed income trading revenue, so JPMorgan's results could mean the business is not as bad as feared.
The bank benefited from a turnaround in its retail banking unit, which reported a profit of $708 million compared with a loss of $399 million in the year-earlier quarter.
Still, JPMorgan had to put aside $1.5 billion of additional litigation reserves related to soured mortgages it sold to investors and homes it may have improperly foreclosed on.
Bank of America Corp last week agreed to pay $2.8 billion to mortgage finance giants Fannie Mae and Freddie Mac to settle claims that it sold bad home loans to them.
Many investors fear that other banks will have to make similar settlement with the two government-backed entities.
(Additional reporting by Maria Aspan in New York and Dominic Lau in London; Editing by Lisa Von Ahn and Steve Orlofsky)
12.23.2010
Top holding in Canada 12/23/10
1. Manulife Financial (MFC) CA$31.38 STRONG BUY
2. TD Bank (TD) CA$82.19 => CA$83.84 HOLD
3. Imperial Oil (IMO) CA$47.82 BUY
4. Shoppers Drug Mart (SC) CA$ 42.7 HOLD
5. TransCanada (TRP) CA$41.10 HOLD
TD Bank to buy Chrysler Financial for US$6.3B, the auto leaders with 1 million customers, net assets of US$5.9B by its internal funds (existing shareholders not being diluted). I think this deal is good given the following fact:
1. Strong 2010 auto sales in USA (thanks to Toyota’s “collapse” & slow economy recovery)
2. Auto loan default rate normally lower than bank card loan & mortgage loan at 1.77% which improved by 77 bps compare to year 2009’s average & even it is still 15 bps higher than pre-financial crisis
3. Given TD Bank can use its strong deposit base to support this auto loan business, the interest spread TD Bank will be higher than Chrysler
4. Purchase price of $6.3B or 7% higher than book value looks low (normally, the average is about 2 times book value)
5. Risk of minimal or even negative earning if the prime rate continue to remind low while bond rate are all up cuz auto loans are based on prime rate
2. TD Bank (TD) CA$82.19 => CA$83.84 HOLD
3. Imperial Oil (IMO) CA$47.82 BUY
4. Shoppers Drug Mart (SC) CA$ 42.7 HOLD
5. TransCanada (TRP) CA$41.10 HOLD
TD Bank to buy Chrysler Financial for US$6.3B, the auto leaders with 1 million customers, net assets of US$5.9B by its internal funds (existing shareholders not being diluted). I think this deal is good given the following fact:
1. Strong 2010 auto sales in USA (thanks to Toyota’s “collapse” & slow economy recovery)
2. Auto loan default rate normally lower than bank card loan & mortgage loan at 1.77% which improved by 77 bps compare to year 2009’s average & even it is still 15 bps higher than pre-financial crisis
3. Given TD Bank can use its strong deposit base to support this auto loan business, the interest spread TD Bank will be higher than Chrysler
4. Purchase price of $6.3B or 7% higher than book value looks low (normally, the average is about 2 times book value)
5. Risk of minimal or even negative earning if the prime rate continue to remind low while bond rate are all up cuz auto loans are based on prime rate
Top holding in USA 12/23/10
1. Google Inc. (GOOG) US$745.1 BUY
2. Wells Fargo Financial (WFC) US$41.1 STRONG BUY
3. General Electric (GE) US$19.7 BUY => HOLD
4. American Express (AXP) US$48.6 HOLD
5. Walt’s Disney (DIS) US$36.99 HOLD
2. Wells Fargo Financial (WFC) US$41.1 STRONG BUY
3. General Electric (GE) US$19.7 BUY => HOLD
4. American Express (AXP) US$48.6 HOLD
5. Walt’s Disney (DIS) US$36.99 HOLD
- American Express share price down recently from US$46.5 to US$41.0 (climb back a bit) on the worry USA government will be more restricted in credit card service charges. Last week, VISA & Master Card share price got the hit as the regulator reform the debit card service charges.
- General Electric’s (I will use GE in below, it is how its own press release name themselves though) share price did not recover as fast as the big 4 banks, nor the giant industrial corp such as Caterpillar, the main reason is because of GE Capital – the finance segment @ GE.
1. GE is an industrial / technology corp which manufacture energy / power / health equipments & devices
2. With its strong financial position, they are able to borrow short term loan cheap enough and lent it through GE Capital to their customers in long term (just like u buy a car through finance & then Honda/Nissan/Mini Copper lend $$ to u)
3. After the financial crisis, GE gets harder to borrow cheaper, therefore, its GE Capital interest spread got narrow down at the same time rise a potential cash flow issues (cuz they borrow in short term but lent it for long term)
4. Investors has an ongoing cash concern on GE, that’s why its share price only up about 130% from bottom compare to say Wells Fargo which up 250%.
12.02.2010
Top holding in Canada 12/02/10
1. Manulife Financial (MFC) CA$31.38 STRONG BUY
2. TD Bank (TD) CA$82.2 BUY => HOLD
3. Imperial Oil (IMO) CA$45.2 BUY
4. Shoppers Drug Mart (SC) CA$ 42.7 HOLD
5. TransCanada (TRP) CA$39.45 => CA$41.10 HOLD
2. TD Bank (TD) CA$82.2 BUY => HOLD
3. Imperial Oil (IMO) CA$45.2 BUY
4. Shoppers Drug Mart (SC) CA$ 42.7 HOLD
5. TransCanada (TRP) CA$39.45 => CA$41.10 HOLD
- Last week, Ontario government propose the long term energy plan (LTEP), outlines the plan for Ontario power & transmission system for the next 20 years. Given the fact we may face a possible 24k MW deficiency in generation by 2025, the government plan to spend $87B to increased the MW from current 39k MW to 52k MW ($33B on refurbish the existing nuclear power plant; $27B on building new wind, solar & bio-energy power plant which will deliver 10.5k MW power). Given TransCanada invested heavily in nuclear & wind power, this government plan will have positive impact to TransCanada’s future earnings (Although we all upset cuz our electricity bill will double in 20 years – 3.5% per year)
- TD Bank release its 4q10 results, profit down 1.6% quarter to date & up 48.9% year to date compare to 2009. Excluding $121m 4q non-recurring tax provision, quarter to date profit actually up 10.4% which is on expectation. Deposit up 9.96%, loan up 6.67% and loan to deposit ratio down by 4.93% to 62.80% . I do not see any significant rise in revenue nor in profit for 2011. Given the fact that TD’s price earnings ratio & price per book value ratio are 14.40 & 1.66, it has already priced in.
11.01.2010
Top holding in Asia/Europe 11/01/10
1. China Mobile (0941/CHL)
2. China Life (2628/LFC)
3. China Construction Bank (0939)
4. Shiu On Land (0272)
5. HSBC (0005/HBC)
- China Life: premium up 23% vs 3q09, total assets up 4.0% vs 2q10 while equity up 7.7% vs 2q10, as Shang Hang A stock break through 3k pt & interest rate up 25 bps, I think China Life will continue to increase shareholders equity value in 4q10 and so on, regardless of how much the reported net income is. In terms of stock value, I think today’s price is quite reasonable, not in big sales.
- China Construction Bank: results look awesome!! I still haven’t completed the trend analysis, will let all u know. It rise 13% from the day I came back to Canada, price over book rise to 2.43 and estimate price over earning rise to 10.1. um…………..still look reasonable but not in big sales.
- Bilibala will sold BYD Ltd. (not a wise decision to invest at 1st place, not cuz it is not good, but cuz I am not that familiar about the company plus I am worry commodity & labour cost will rise at least 10% per year which will hurt BYD’s earning) & invest more Shiu On Land today.
4.06.2010
China CCB may raise $11 bln via share sales
Bilibala: I don't think China Construction Bank need cash, if the cash is merely try to fulfil the high capital requirement by the regulator, I hope it will have a better use of it. Or else, it is not a great decision for the existing shareholders.
http://uk.reuters.com/article/idUKTOE63504620100406
SHANGHAI, April 6 (Reuters) - China Construction Bank (CCB) (0939.HK) (601939.SS), the country's second-biggest lender, plans to raise about 75 billion yuan ($11 billion) through share sales this year to replenish its capital, Bloomberg News reported on its website, citing unidentified sources.
CCB may raise as much as 45 billion yuan in a private placement in Shanghai and 30 billion yuan in a rights offer in Hong Kong, the report said.
The fundraising plan has won approval from the State Council, or China's cabinet, and is subject to revision according to market conditions, the article said.
Zhang Jinguo, deputy general manager of CCB's board of directors office, declined to comment.
CCB, in which Bank of America (BAC.N) owns an 11 percent stake, met on March 10 to discuss potential fundraising plans, sources familiar with the matter told Reuters. [nTOE62P06S]
CCB Chairman Guo Shuqing said last week the bank was examining ways of raising capital but had no immediate plans to do so. [nTOE62S08A]
Chinese banks, including Bank of China (3988.HK) (601988.SS) and Industrial and Commercial Bank of China (1398.HK) (601398.SS), are rushing to raise cash after last year's government-directed lending binge weakened their balance sheets.
http://uk.reuters.com/article/idUKTOE63504620100406
SHANGHAI, April 6 (Reuters) - China Construction Bank (CCB) (0939.HK) (601939.SS), the country's second-biggest lender, plans to raise about 75 billion yuan ($11 billion) through share sales this year to replenish its capital, Bloomberg News reported on its website, citing unidentified sources.
CCB may raise as much as 45 billion yuan in a private placement in Shanghai and 30 billion yuan in a rights offer in Hong Kong, the report said.
The fundraising plan has won approval from the State Council, or China's cabinet, and is subject to revision according to market conditions, the article said.
Zhang Jinguo, deputy general manager of CCB's board of directors office, declined to comment.
CCB, in which Bank of America (BAC.N) owns an 11 percent stake, met on March 10 to discuss potential fundraising plans, sources familiar with the matter told Reuters. [nTOE62P06S]
CCB Chairman Guo Shuqing said last week the bank was examining ways of raising capital but had no immediate plans to do so. [nTOE62S08A]
Chinese banks, including Bank of China (3988.HK) (601988.SS) and Industrial and Commercial Bank of China (1398.HK) (601398.SS), are rushing to raise cash after last year's government-directed lending binge weakened their balance sheets.
3.08.2010
CCB's outlook on 2010 new lending
Bilibala: giant bank is better than small/mid bank even in China, a country where huge banks have much more social responsibity & political concern than the commerical banks. Sometimes, conservative can be a good character, a little lower return with much lesser risk.
http://www.reuters.com/article/idUSTOE62703Q20100308
Govt targets 19 pct loan growth for banking sector (Adds details, background)BEIJING, March 8 (Reuters) - China Construction Bank (0939.HK), China's No.2 bank by assets, said its new lending will grow by a modest 10 percent or more this year, as banks slow new loans growth following a lending binge in 2010 under Beijing's economic stimulus programme.
CCB Chairman Guo Shuping gave Reuters the forecast on the sidelines of the National People's Congress in Beijing on Monday, adding that the bank expected its provision ratio for non-performing loans to remain above 170 percent this year.
Chinese banks posted a record 9.6 trillion yuan ($1.406 trillion) in new loans last year, fuelling concern they were sowing the seeds for a new crop of bad debts down the road.
The government has targeted 7.5 trillion yuan in new lending this year, down from last year but a figure that would still lift the industry's overall outstanding loan volume by 19 percent from the end of 2009.
CCB (601939.SS) and China's other biggest lenders including ICBC (1398.HK)(601398.SS) were relatively conservative in their lending last year compared with mid-sized and smaller banks, which sharply turned up lending in response to Beijing's 4 trillion yuan stimulus plan aimed at boosting consumption.
As a result, many of those smaller banks are believed to need new capital to boost their adequacy ratios.
China CITIC Bank (0998.HK)(601998.SS) is actively exploring raising capital [ID:nBJC002509], and China Merchants Bank (3968.HK)(600036.SS) is launching a $3.2 billion rights issue, but this week said it should require no further capital raising for at least the next three years. [ID:nBJB003703]
Bank of Communications (BoCom) (3328.HK) (601328.SS), China's fifth-largest lender, said last month that it planned to raise as much as 42 billion yuan via a rights issue in Shanghai and Hong Kong to bolster capital.
3.03.2010
中國移動認購浦發銀行
Bilibala: Short term impact, should be a good opportunity to buy more. I think it is a better use of the extra cash China Mobile had
財華社深圳新聞中心
近日盛傳可能斥資400億元認購浦發銀行(600000-CN)約22億股定向增發股份的中國移動，股價今早初段逆市走弱，現跌2.28%至72.95港 元，成交826萬股。中國移動發布公告確認，已就入股浦發銀行的規模達成協議，將通過投資浦發銀行擴展移動電子商務業務；但將專注於開發增值服務。中國移 動同時表示不排除與其他銀行合作的可能性。
有市場評論認為，中國移動開發移動電子商務業務是遠離主營業務的多元化做法，難以量化可能獲得的收益。長線投資者將中國移動作為公用事業類股，原因是3.7%的歷史股息收益率，而入股浦發銀行所帶來的大規模資本支出也可能擊碎投資者對該公司提高股利支付比率的預期。
但大華繼顯則稱，中國移動之前曾談及將在2010年推出高附加值的移動支付業務；與浦發銀行在移動支付領域的合作不但能夠幫助中國移動解決監管問題，還能夠獲得交叉銷售效應。
財華社深圳新聞中心
近日盛傳可能斥資400億元認購浦發銀行(600000-CN)約22億股定向增發股份的中國移動，股價今早初段逆市走弱，現跌2.28%至72.95港 元，成交826萬股。中國移動發布公告確認，已就入股浦發銀行的規模達成協議，將通過投資浦發銀行擴展移動電子商務業務；但將專注於開發增值服務。中國移 動同時表示不排除與其他銀行合作的可能性。
有市場評論認為，中國移動開發移動電子商務業務是遠離主營業務的多元化做法，難以量化可能獲得的收益。長線投資者將中國移動作為公用事業類股，原因是3.7%的歷史股息收益率，而入股浦發銀行所帶來的大規模資本支出也可能擊碎投資者對該公司提高股利支付比率的預期。
但大華繼顯則稱，中國移動之前曾談及將在2010年推出高附加值的移動支付業務；與浦發銀行在移動支付領域的合作不但能夠幫助中國移動解決監管問題，還能夠獲得交叉銷售效應。
1.21.2010
Bilibala mailbox 10/01/21
Question:
brk.b goes up to 72 this morning. is it too high to buy? or focus onwfc? how about mfc? why u suggest to buy more? thanks
Answer:
Berkshire Hathaway
Berkshire Hathaway go up these 2 days from $65.0 (or $3,250 before split) to above $72.0 because of
brk.b goes up to 72 this morning. is it too high to buy? or focus onwfc? how about mfc? why u suggest to buy more? thanks
Answer:
Berkshire Hathaway
Berkshire Hathaway go up these 2 days from $65.0 (or $3,250 before split) to above $72.0 because of
- the stock split which trigger the transaction volume to go up because the price is lot more "attractive" & "relatively cheaper" in an irrational investment sense after it dropped from $3,300 to only $66.0
- Warren Buffett indirectly mentioned in an interview that the stock price is undervalue
In long run, Berkshire Hathaway's price is still undervalue, however, to most of the investors, will refuse to buy when it is going up.
On the other hand, stock split has no impact to the value of a company, if i assume everything else is constant, price will adjust back to where it should be after a short term rally.
Wells Fargo
I have a better idea on Wells Fargo’s 2010 outlook after a flash review of its 4q09 and 2009 results. I think its EPS should be able to rise from US$1.75 in 2009 to US$2.85 & US$3.05 in 2010 & 2011. Given the following:
- Continue improve in net interest margin
- Expect the loan provision to drop smoothly in 2010 and further in 2011
- Paid off the $25B TARP in 4q09 – will save $420M dividend expenses per qtr
- House market recover Its 12 months target price should at least be US$34.77.
I personally think Wells Fargo worth US$60.0 by the end of 2014 (5 years from now).Given the current stock price is US$27.82 (01/20/10’s closed), there will be a potential return of 25% in the coming 12 months.
Manulife Financial
I see significant improve in investors confident to equity market. Manulife’s 4Q sales should improve while sum at risk will fall. Bilibala increases its fair value from C$31 to C$35.
I need to review its 4q09 & 2009 result before I can hold firm on my opinion.
1.12.2010
China Bank raise deposit in reserve
Bilibala: it is a good way to prevent over-value on assets. Bank makes enough money from borrowers and depositers, so it should be ok for all parties.
http://www.reuters.com/article/idUSTRE60B1SZ20100112?feedType=nl&feedName=usbusinessearly
BEIJING (Reuters) - China on Tuesday raised the proportion of deposits that banks must hold in reserve, in the clearest sign yet that it has started to tighten monetary policy with its economy roaring back to the brink of overheating.
The 0.5 percentage point increase in the reserve requirement ratio will take effect on January 18 and will apply to all banks apart from rural credit cooperatives, the People's Bank of China said on its website (www.pbc.gov.cn).
It was the first time that the central bank adjusted the ratio since it lowered the ratio in December 2008 as part of its loosening cycle at the time.
Many in the market had thought that China might increase RRR before it lifted interest rates, but the move came far earlier than expected amid concerns that a renewed surge in bank lending was flooding the economy with too much cash.
Shi Lei, an analyst at Bank of China in Beijing, said there could two or three more RRR increases before June.
"The reserve ratio hike is a strong signal the central bank is stepping up efforts to absorb excessive liquidity," Shi said. "The hike may drain about 200-300 billion yuan from the market but it really needs to drain about 700-800 billion yuan."
The RRR increase also followed two other tightening steps taken by the central bank on Tuesday.
The central bank raised the yield on its 20 billion yuan ($2.9 billion) in one-year bills by about 8 basis points (bps) to 1.8434 percent after holding it steady in the previous 20 auctions, compared with a median forecast among traders that it would go up by just 4 bps.
It also drained a record 200 billion yuan via 28-day bond repurchase agreements, ensuring it will draw net funds from the market this week.
"This is exactly what happens with Chinese policy. They say fine tuning. It never happens that way. It's always nothing or boom," Ken Peng, an analyst with Citigroup in Beijing said.
"When they reach a consensus, it happens very quickly," he added.
The tightening steps come after reports that bank lending surged in the first week of the year to 600 billion yuan, adding to concerns fueled by blockbuster trade data for December that the world's third-largest economy is overheating.
(Editing by Andy Bruce)
http://www.reuters.com/article/idUSTRE60B1SZ20100112?feedType=nl&feedName=usbusinessearly
BEIJING (Reuters) - China on Tuesday raised the proportion of deposits that banks must hold in reserve, in the clearest sign yet that it has started to tighten monetary policy with its economy roaring back to the brink of overheating.
The 0.5 percentage point increase in the reserve requirement ratio will take effect on January 18 and will apply to all banks apart from rural credit cooperatives, the People's Bank of China said on its website (www.pbc.gov.cn).
It was the first time that the central bank adjusted the ratio since it lowered the ratio in December 2008 as part of its loosening cycle at the time.
Many in the market had thought that China might increase RRR before it lifted interest rates, but the move came far earlier than expected amid concerns that a renewed surge in bank lending was flooding the economy with too much cash.
Shi Lei, an analyst at Bank of China in Beijing, said there could two or three more RRR increases before June.
"The reserve ratio hike is a strong signal the central bank is stepping up efforts to absorb excessive liquidity," Shi said. "The hike may drain about 200-300 billion yuan from the market but it really needs to drain about 700-800 billion yuan."
The RRR increase also followed two other tightening steps taken by the central bank on Tuesday.
The central bank raised the yield on its 20 billion yuan ($2.9 billion) in one-year bills by about 8 basis points (bps) to 1.8434 percent after holding it steady in the previous 20 auctions, compared with a median forecast among traders that it would go up by just 4 bps.
It also drained a record 200 billion yuan via 28-day bond repurchase agreements, ensuring it will draw net funds from the market this week.
"This is exactly what happens with Chinese policy. They say fine tuning. It never happens that way. It's always nothing or boom," Ken Peng, an analyst with Citigroup in Beijing said.
"When they reach a consensus, it happens very quickly," he added.
The tightening steps come after reports that bank lending surged in the first week of the year to 600 billion yuan, adding to concerns fueled by blockbuster trade data for December that the world's third-largest economy is overheating.
(Editing by Andy Bruce)
12.24.2009
TARP makes profit of at least $16 bln so far
http://www.marketwatch.com/story/tarp-profit-at-least-16-bln-so-far-treasury-2009-12-23?reflink=MW_news_stmp
By Alistair Barr, MarketWatch
SAN FRANCISCO (MarketWatch) -- The Troubled Asset Relief Program has generated at least $16 billion in profit so far, the Treasury Department said late Wednesday.
Earlier Wednesday, Citigroup (C 3.28, -0.01, -0.30%) and Wells Fargo (WFC 26.82, -0.03, -0.11%) said they repaid $45 billion that they got from TARP. That brings the total amount repaid into the program to $164 billion, the Treasury explained. Read about Citi and Wells repayments.
Total repayments by TARP banks should top $175 billion by the end of 2010, cutting taxpayer exposure to the sector by three-quarters, the Treasury estimated.
TARP programs aimed at stabilizing the banking system will earn a profit from dividends, interest, early repayments, and the sale of warrants, it added. Bank investments of $245 billion in Treasury's 2009 fiscal year were initially projected to cost $76 billion, but are now forecast to generate a profit.
"Taxpayers have already received over $16 billion in profits from all TARP programs and that profit could be considerably higher as the Treasury sells additional warrants in the weeks ahead," the Treasury said in a statement.
However, some large TARP investments have yet to play out. American International Group (AIG 29.42, +0.01, +0.03%) got $40 billion from TARP in November 2008, at the height of the financial crisis. AIG was bailed out again later and it's not clear if the insurer will ever be able to repay taxpayers fully for their support.
According to a recent Treasury report, 55 institutions that received TARP money are delinquent on dividends they owe the government, as of a Nov. 16 payment deadline.
Most of these are smaller banks, such as Integra Bank Corp (IBNK 0.81, +0.06, +8.00%) , Independent Bank Corp. (IBCP 0.73, -0.03, -3.62%) and Hampton Roads Bancshares (HMPR 1.73, +0.06, +3.59%) , according to SNL Financial.
11.26.2009
China Construction Bank:Regulator May Strengthen Capital Requirement
BEIJING -(Dow Jones)- China Construction Bank Corp. (0939.HK) said Monday the country's banking regulator is considering tightening capital requirements for lenders next year, and CCB is closely monitoring the situation.
CCB spokesman Hu Changmiao told Dow Jones Newswires the China Banking Regulatory Commission may raise the capital adequacy requirement for banks from the current 10%, though detailed rules have not been issued yet. The CBRC ordered banks to raise their capital adequacy to 10% form 8% at the end of last year.
The regulator has repeatedly warned of possible risks arising from the explosive growth in lending earlier this year.
=> in long term, the tighten of lending is a must and it will help the economy to grow more stablely and healthy.
=> capital adequacy rise from 8% to 10%, to me is more like a requirement to be in line with international standard instead of the bank really lack of capital.
-Victoria Ruan contributed to this article, Dow Jones Newswires; 8610 8400 7799; victoria.ruan@dowjones.com
Big Banks Poised for Big Gains
http://wallstnation.com/BAC-WFC-JPM-higher-next-year-11242009
If you are sitting on the sidelines, paralyzed with fear about investing in some big banks, then think about this… JPMorgan Chase & Co. (NYSE:JPM), Wells Fargo & Company (NYSE:WFC), and Bank of America Corporation (NYSE:BAC) are the leading commercial banks in America. We are coming out of the financial crisis , which sent our economy in a tailspin for the past 2 years. The stock prices of those banks are reflecting current earnings power and not normalized earnings. Given that short-term interest rates are at unheard levels (3-month treasury yields at .01%, 6-month yields at .13%, and 12-month yields at .26%), it makes the banking industry a hugely profitable business today. John Paulson projects that latter part of 2011 will begin to show the profits these banks are making, and the banks’ stock prices will reflect.
=> true, the impact of financial crisis is still on, and the trend of deleverage may still continue until unemployment rate peak (hopefully early next year). On the other hand, with the historical low interest rate that widen interest spread & lesser player in the loan market, I am sure the banks will be more profitable than ever.
Amit Shah wrote a great piece on the subject of JPM, BAC & WFC at SeekingAlpha. He states that “The banks are not paying dividends so tangible book value is increasing rapidly, and capital ratios are higher than ever in an improving economic environment.” He believes in the next few months, the large-cap U.S. banks will go much higher.
=> I think the large cap US banks already rise back to a reasonable price at recession level. I don't think price will go dramatically higher in short run.
He also describes in his article his opinions that John Paulson and Warren Buffett are far more intelligent than Meredith Whitney and Dick Bove. He believes that anyone investing based on Meredith Whitney and Dick Bove's advice will miss the next leg higher on large-cap banks. He seems to make a valid point with this.
=> that's fairly true.
Check out the full article here and also review some of his analysis and reasoning why the stocks should see higher levels next year.
Amit concludes his article with a strong point when he indicates he is long in all three bans mentioned: JPMorgan Chase & Co. (NYSE:JPM), Wells Fargo & Company (NYSE:WFC), and Bank of America Corporation (NYSE:BAC).
If you are sitting on the sidelines, paralyzed with fear about investing in some big banks, then think about this… JPMorgan Chase & Co. (NYSE:JPM), Wells Fargo & Company (NYSE:WFC), and Bank of America Corporation (NYSE:BAC) are the leading commercial banks in America. We are coming out of the financial crisis , which sent our economy in a tailspin for the past 2 years. The stock prices of those banks are reflecting current earnings power and not normalized earnings. Given that short-term interest rates are at unheard levels (3-month treasury yields at .01%, 6-month yields at .13%, and 12-month yields at .26%), it makes the banking industry a hugely profitable business today. John Paulson projects that latter part of 2011 will begin to show the profits these banks are making, and the banks’ stock prices will reflect.
=> true, the impact of financial crisis is still on, and the trend of deleverage may still continue until unemployment rate peak (hopefully early next year). On the other hand, with the historical low interest rate that widen interest spread & lesser player in the loan market, I am sure the banks will be more profitable than ever.
Amit Shah wrote a great piece on the subject of JPM, BAC & WFC at SeekingAlpha. He states that “The banks are not paying dividends so tangible book value is increasing rapidly, and capital ratios are higher than ever in an improving economic environment.” He believes in the next few months, the large-cap U.S. banks will go much higher.
=> I think the large cap US banks already rise back to a reasonable price at recession level. I don't think price will go dramatically higher in short run.
He also describes in his article his opinions that John Paulson and Warren Buffett are far more intelligent than Meredith Whitney and Dick Bove. He believes that anyone investing based on Meredith Whitney and Dick Bove's advice will miss the next leg higher on large-cap banks. He seems to make a valid point with this.
=> that's fairly true.
Check out the full article here and also review some of his analysis and reasoning why the stocks should see higher levels next year.
Amit concludes his article with a strong point when he indicates he is long in all three bans mentioned: JPMorgan Chase & Co. (NYSE:JPM), Wells Fargo & Company (NYSE:WFC), and Bank of America Corporation (NYSE:BAC).
11.05.2009
Opinion on China Banks
做中資股的股東感覺特別安心，因為它們每季須公布業績，讓你知道公司最新情況。
大部分中資銀行在上星期公布了第三季度業績，若它們成績符合預期，我會更加安心，可惜不是。
工行公布第三季純利為三百四十億元人民幣（下同），計及上兩季，累積盈利約一千億元，較去年稍低。到目前為止，工行每季約賺三百至三百五十億元，若第四季能保持的話，全年盈利便達一千三百億元。不過，去年中國政府落力冷卻市場，大部分銀行在第四季出現巨額撥備，令盈利減少，故此去年工行全年盈利只得一千一百億元。
中行最平無人知悉今年會否再有類似的巨額撥備，我個人意見是有，但未必像去年一樣多；我預期工行今年盈利約為一千二百億元，或每股賺港幣四毫。以上週收市價六元三角計算，其市值約為二萬一千億港元，市盈率約十五倍半。工行貴為全球市值最大的銀行，增長速度可能逐漸放緩，惟它仍然會增長，我預期每年增長幅度約一成至一成半，十五倍半的市盈率頗為吸引，但已不及往昔。
建行（ 939） 第三季盈利為三百億元， 首三季加起來賺八百六十億元， 以工行的準則推算，建行全年盈利應為一千零五十億元，即每股賺港幣五毫。以每股六元八角計算，市值約為一萬六千億港元，市盈率十三點三倍，比工行便宜，我認為仍然是一項好投資，儘管不再是極度吸引。至於中行，第三季賺二百一十億元，首三季合共賺六百二十億元，若第四季純利達一百三十億元，全年便可賺七百五十億元，以每股四元五角計算，其市值約為一萬一千五百億港元，市盈率十三倍，比建行更平。
港股應公布季度業績我們亦可以資產淨值，來比較這三隻內銀股，工行的每股資產淨值為一元九角三分；建行為二元三角；中行則是一元九角四分。跟股價相比，工行是三者中最貴，中行則最平。這未必是最好的評審標準，因為資產質素及管理層的水準，更加影響公司的盈利能力。
投資組合方面，我看不到有任何理由作出變更，雖然建行今天的股價比工行便宜，而中行則更平，但差異未至於需要為其額外負擔一筆交易徵費。如果我是一個活躍的投資者，可能會沽工行換馬建行或中行，但我相信大部分的讀者，都寧願採取一個溫和舒適的投資態度。
當收到這些中資銀行的季度業績，讓大家清楚知道手持的內銀股的最新情況，大家應該質疑香港的監管機構，為何對在港上市的大公司沒有類似要求。特別是當滙豐的董事既然每季向美國監管機構公布業績，為什麼不讓持股更多的香港股東了解最新情況？若股東的知情權不受重視，有可能導致謠言滿天飛。滙豐作為大藍籌的一哥，若能率先在港公布季度業績，將能加強我們信心。
天下第一仓 拨 论尽三大内银股 东尼 11月5日
大部分中資銀行在上星期公布了第三季度業績，若它們成績符合預期，我會更加安心，可惜不是。
工行公布第三季純利為三百四十億元人民幣（下同），計及上兩季，累積盈利約一千億元，較去年稍低。到目前為止，工行每季約賺三百至三百五十億元，若第四季能保持的話，全年盈利便達一千三百億元。不過，去年中國政府落力冷卻市場，大部分銀行在第四季出現巨額撥備，令盈利減少，故此去年工行全年盈利只得一千一百億元。
中行最平無人知悉今年會否再有類似的巨額撥備，我個人意見是有，但未必像去年一樣多；我預期工行今年盈利約為一千二百億元，或每股賺港幣四毫。以上週收市價六元三角計算，其市值約為二萬一千億港元，市盈率約十五倍半。工行貴為全球市值最大的銀行，增長速度可能逐漸放緩，惟它仍然會增長，我預期每年增長幅度約一成至一成半，十五倍半的市盈率頗為吸引，但已不及往昔。
建行（ 939） 第三季盈利為三百億元， 首三季加起來賺八百六十億元， 以工行的準則推算，建行全年盈利應為一千零五十億元，即每股賺港幣五毫。以每股六元八角計算，市值約為一萬六千億港元，市盈率十三點三倍，比工行便宜，我認為仍然是一項好投資，儘管不再是極度吸引。至於中行，第三季賺二百一十億元，首三季合共賺六百二十億元，若第四季純利達一百三十億元，全年便可賺七百五十億元，以每股四元五角計算，其市值約為一萬一千五百億港元，市盈率十三倍，比建行更平。
港股應公布季度業績我們亦可以資產淨值，來比較這三隻內銀股，工行的每股資產淨值為一元九角三分；建行為二元三角；中行則是一元九角四分。跟股價相比，工行是三者中最貴，中行則最平。這未必是最好的評審標準，因為資產質素及管理層的水準，更加影響公司的盈利能力。
投資組合方面，我看不到有任何理由作出變更，雖然建行今天的股價比工行便宜，而中行則更平，但差異未至於需要為其額外負擔一筆交易徵費。如果我是一個活躍的投資者，可能會沽工行換馬建行或中行，但我相信大部分的讀者，都寧願採取一個溫和舒適的投資態度。
當收到這些中資銀行的季度業績，讓大家清楚知道手持的內銀股的最新情況，大家應該質疑香港的監管機構，為何對在港上市的大公司沒有類似要求。特別是當滙豐的董事既然每季向美國監管機構公布業績，為什麼不讓持股更多的香港股東了解最新情況？若股東的知情權不受重視，有可能導致謠言滿天飛。滙豐作為大藍籌的一哥，若能率先在港公布季度業績，將能加強我們信心。
天下第一仓 拨 论尽三大内银股 东尼 11月5日
10.28.2009
10.25.2009
China Construction Bank 3q09 press release
As at 30 September 2009, total assets of the Group reached RMB9,353,972 million, an
increase of RMB1,798,520 million or 23.80% over the end of last year. Total liabilities reached
RMB8,816,947 million, an increase of RMB1,729,057 million or 24.39% over the end of last
year.
=> loan growth slow down in 3q but rise significantly compare to last year at the same time consistent with deposit growth.
Net loans and advances to customers reached RMB4,563,208 million, an increase of
RMB879,633 million or 23.88% over the end of last year. Loans granted to infrastructure
sectors increased by 27.47% to RMB1,514,915 million over the end of last year. Deposits from
customers reached RMB7,791,445 million, an increase of RMB1,415,530 million or 22.20%
over the end of last year.
Total equity was RMB537,025 million, an increase of RMB69,463 million or 14.86% over the
end of last year. Capital adequacy ratio decreased by 0.05 percentage points to 12.11%; core
capital adequacy ratio decreased by 0.60 percentage points to 9.57% compared to the end of last
year.
=> Book value rise to RM$2.30 (or HK#2.60), price to book value rise to 2.7. A bit high in short term, but I think 3.0 times is still reasonable. Finally close to my fair value price I mentioned about in March.
Compared to the end of last year, the non-performing loans decreased by RMB10,200 million
to RMB73,682 million in accordance with the five-category classification standard; the nonperforming loan ratio was 1.57%, down by 0.64 percentage points; the ratio of allowances to
non-performing loans was 161.08%, up by 29.50 percentage points.
=> non-performance loans down, good!!! Allowance is a future projection, but I think bad debt ratio in China is at a reasonable level.
The carrying amount of the US sub-prime mortgage loan backed securities held by the Group
was US$109 million, after allowances for impairment losses of US$726 million. The carrying
amount of the Alt-A bonds held by the Group was US$182 million, and the allowances for
impairment losses on such securities were US$264 million.
=> immaterial
For the nine months ended 30 September 2009, net profit of the Group was RMB86,162
million, of which the net profi t attributable to equity shareholders of the Bank was RMB86,119
million, up 2.25% and 2.24% respectively over the same period last year. Annualised return on
average assets was 1.36%, and annualised return on average equity was 22.78%.
The net interest income was RMB155,580 million, down by 7.49% over the same period last
year. Net interest spread was 2.30% and the net interest margin was 2.41%, down by 0.87
percentage points and 0.89 percentage points respectively over the same period last year.
Net fee and commission income reached RMB35,763 million, an increase of 20.94% over the
same period last year. Cost-to-income ratio was 35.55%, which remained at a low level.
The income tax was RMB25,442 million, up by 4.09% over the same period last year, and the
effective income tax rate was 22.80%.
=> net margin down from 2.41% to 2.30%, in line with my expectation, looks good.
increase of RMB1,798,520 million or 23.80% over the end of last year. Total liabilities reached
RMB8,816,947 million, an increase of RMB1,729,057 million or 24.39% over the end of last
year.
=> loan growth slow down in 3q but rise significantly compare to last year at the same time consistent with deposit growth.
Net loans and advances to customers reached RMB4,563,208 million, an increase of
RMB879,633 million or 23.88% over the end of last year. Loans granted to infrastructure
sectors increased by 27.47% to RMB1,514,915 million over the end of last year. Deposits from
customers reached RMB7,791,445 million, an increase of RMB1,415,530 million or 22.20%
over the end of last year.
Total equity was RMB537,025 million, an increase of RMB69,463 million or 14.86% over the
end of last year. Capital adequacy ratio decreased by 0.05 percentage points to 12.11%; core
capital adequacy ratio decreased by 0.60 percentage points to 9.57% compared to the end of last
year.
=> Book value rise to RM$2.30 (or HK#2.60), price to book value rise to 2.7. A bit high in short term, but I think 3.0 times is still reasonable. Finally close to my fair value price I mentioned about in March.
Compared to the end of last year, the non-performing loans decreased by RMB10,200 million
to RMB73,682 million in accordance with the five-category classification standard; the nonperforming loan ratio was 1.57%, down by 0.64 percentage points; the ratio of allowances to
non-performing loans was 161.08%, up by 29.50 percentage points.
=> non-performance loans down, good!!! Allowance is a future projection, but I think bad debt ratio in China is at a reasonable level.
The carrying amount of the US sub-prime mortgage loan backed securities held by the Group
was US$109 million, after allowances for impairment losses of US$726 million. The carrying
amount of the Alt-A bonds held by the Group was US$182 million, and the allowances for
impairment losses on such securities were US$264 million.
=> immaterial
For the nine months ended 30 September 2009, net profit of the Group was RMB86,162
million, of which the net profi t attributable to equity shareholders of the Bank was RMB86,119
million, up 2.25% and 2.24% respectively over the same period last year. Annualised return on
average assets was 1.36%, and annualised return on average equity was 22.78%.
The net interest income was RMB155,580 million, down by 7.49% over the same period last
year. Net interest spread was 2.30% and the net interest margin was 2.41%, down by 0.87
percentage points and 0.89 percentage points respectively over the same period last year.
Net fee and commission income reached RMB35,763 million, an increase of 20.94% over the
same period last year. Cost-to-income ratio was 35.55%, which remained at a low level.
The income tax was RMB25,442 million, up by 4.09% over the same period last year, and the
effective income tax rate was 22.80%.
=> net margin down from 2.41% to 2.30%, in line with my expectation, looks good.
10.23.2009
Wells Fargo 3q09 press release
WELLS FARGO REPORTS RECORD Q3 AND YEAR-TO-DATE NET INCOME
• 3rd consecutive quarter of record earnings
- Record Wells Fargo net income of $3.2 billion, up 98 percent from last year; $9.5 billion year to
date, up 75 percent from last year
- Diluted earnings per common share of $0.56, up 14 percent from last year; $1.69 per share year to date
- Results driven by record $10.8 billion pre-tax, pre-provision profit (PTPP); PTPP has been more than two times quarterly net charge-offs each quarter this year, despite cyclically elevated net charge-offs. (See footnote 4 on page 20 for information on PTPP)
=> awesome results and consistent with 2q09
• Continued strong revenue
- Revenue of $22.5 billion, flat with record revenue in second quarter 2009
- $169 billion of credit extended to customers in the quarter
- Average checking and savings deposits up 11 percent (annualized) from prior quarter
- Net interest margin of 4.36 percent, up 6 basis points from prior quarter
- Cross-sell for legacy Wells Fargo a record 5.90 for retail bank households
- Broad-based revenue contribution from diverse businesses, including double-digit linked-quarter growth in asset management, auto lending, consumer finance, debit cards, retirement services, SBA lending and wealth management, along with continued strong performance from regional banking and mortgage banking
=> net interest margin improved to 4.36, best among peers and a trend that Wachovia start adpoting the high margin economic moat from legacy Wells Fargo.
• Significant increases in capital, reduction in risk
- Wells Fargo stockholders’ equity increased to $122 billion (10 percent of total assets), up
$23 billion from year end
- Generated $20 billion during the past six months toward the $13.7 billion Supervisory Capital
Assessment Program (SCAP) buffer requirement; PTPP tracking above Company’s internal SCAP estimates and 35 percent above supervisory adverse scenario estimate
- Credit reserves built by $1.0 billion ($3.0 billion year to date), reaching $24.5 billion, or
3.07 percent of total loans and 118 percent of nonaccrual loans
- Substantial increases in capital ratios driven by record retained earnings and other sources of
internal capital generation
=> I personally high the capital ratio in general is too high for the entire bank industry, but if that's what the regulatory and the analysts love to see, I think Wells Fargo has more than enough to meet their wants.
• Current projections show credit losses peaking in 2010, with consumer losses potentially peaking in first half of the year and gradually declining, absent further economic deterioration
- Growth in nonperforming loans and net charge-offs slowing as of third quarter, for consumer and commercial portfolios
- Credit performance of recent vintage legacy Wells Fargo consumer portfolios improving, largely the result of proactive credit management over past two years
- 90 days past due and still accruing levels flat with second quarter; consumer 90 days past due and still accruing declined from prior quarter
- Significantly smaller credit card portfolio than large bank peers
- Pick-a-Pay portfolio currently estimated to have lower life-of-loan losses than originally
estimated, driven in part by extensive and successful loan modification efforts
- Collateral values improving in auto market and housing prices stabilizing in many regions
- Legacy Wells Fargo commercial and commercial real estate portfolio well underwritten and
diversified; Wachovia commercial and commercial real estate portfolio marked down at merger
close at end of last year
- Legacy Wells Fargo loss rate of 3.37 percent, below large bank peers; overall loss rate of
2.50 percent reflected benefit of purchase accounting on Wachovia loan portfolio; combined
losses less than half of Company’s quarterly PTPP
=> provision rise according to my expectation, I think Wells Fargo's estimation is fair and conservative. In certain degree, this is a very econuraging bad news.
• Wachovia integration on track and on schedule
- Estimated cumulative merger expenses reduced to approximately $5.5 billion from $7.9 billion;
on track to achieve $5.0 billion annual run-rate cost savings by completion of integration in 2011
- Cross-sell revenues already being realized
- Credit overall performing in line with original expectations
- First state community bank conversion (Colorado) scheduled for November; conversion of
remaining overlapping markets expected in 2010
=> good!!
• Increased loan modifications
- Provided 62,989 trial and completed modifications through the Home Affordable Modification
Program (HAMP) and 292,005 through Company’s proprietary programs, bringing total this year through September 30, 2009, to 354,994
- Refinanced 987,000 customers’ mortgages using the Home Affordable Refinance Program
(HARP) and other standard refinance programs
- Over 20 percent of PCI Pick-a-Pay portfolio modified through September 30, 2009, with positive early performance
=> mortgage application down 11% last month, but the trend is still going up and I am sure the house market has hit the bottom even though house price rise slowly in the coming year, may upset lots of analysts and economists.
• 3rd consecutive quarter of record earnings
- Record Wells Fargo net income of $3.2 billion, up 98 percent from last year; $9.5 billion year to
date, up 75 percent from last year
- Diluted earnings per common share of $0.56, up 14 percent from last year; $1.69 per share year to date
- Results driven by record $10.8 billion pre-tax, pre-provision profit (PTPP); PTPP has been more than two times quarterly net charge-offs each quarter this year, despite cyclically elevated net charge-offs. (See footnote 4 on page 20 for information on PTPP)
=> awesome results and consistent with 2q09
• Continued strong revenue
- Revenue of $22.5 billion, flat with record revenue in second quarter 2009
- $169 billion of credit extended to customers in the quarter
- Average checking and savings deposits up 11 percent (annualized) from prior quarter
- Net interest margin of 4.36 percent, up 6 basis points from prior quarter
- Cross-sell for legacy Wells Fargo a record 5.90 for retail bank households
- Broad-based revenue contribution from diverse businesses, including double-digit linked-quarter growth in asset management, auto lending, consumer finance, debit cards, retirement services, SBA lending and wealth management, along with continued strong performance from regional banking and mortgage banking
=> net interest margin improved to 4.36, best among peers and a trend that Wachovia start adpoting the high margin economic moat from legacy Wells Fargo.
• Significant increases in capital, reduction in risk
- Wells Fargo stockholders’ equity increased to $122 billion (10 percent of total assets), up
$23 billion from year end
- Generated $20 billion during the past six months toward the $13.7 billion Supervisory Capital
Assessment Program (SCAP) buffer requirement; PTPP tracking above Company’s internal SCAP estimates and 35 percent above supervisory adverse scenario estimate
- Credit reserves built by $1.0 billion ($3.0 billion year to date), reaching $24.5 billion, or
3.07 percent of total loans and 118 percent of nonaccrual loans
- Substantial increases in capital ratios driven by record retained earnings and other sources of
internal capital generation
=> I personally high the capital ratio in general is too high for the entire bank industry, but if that's what the regulatory and the analysts love to see, I think Wells Fargo has more than enough to meet their wants.
• Current projections show credit losses peaking in 2010, with consumer losses potentially peaking in first half of the year and gradually declining, absent further economic deterioration
- Growth in nonperforming loans and net charge-offs slowing as of third quarter, for consumer and commercial portfolios
- Credit performance of recent vintage legacy Wells Fargo consumer portfolios improving, largely the result of proactive credit management over past two years
- 90 days past due and still accruing levels flat with second quarter; consumer 90 days past due and still accruing declined from prior quarter
- Significantly smaller credit card portfolio than large bank peers
- Pick-a-Pay portfolio currently estimated to have lower life-of-loan losses than originally
estimated, driven in part by extensive and successful loan modification efforts
- Collateral values improving in auto market and housing prices stabilizing in many regions
- Legacy Wells Fargo commercial and commercial real estate portfolio well underwritten and
diversified; Wachovia commercial and commercial real estate portfolio marked down at merger
close at end of last year
- Legacy Wells Fargo loss rate of 3.37 percent, below large bank peers; overall loss rate of
2.50 percent reflected benefit of purchase accounting on Wachovia loan portfolio; combined
losses less than half of Company’s quarterly PTPP
=> provision rise according to my expectation, I think Wells Fargo's estimation is fair and conservative. In certain degree, this is a very econuraging bad news.
• Wachovia integration on track and on schedule
- Estimated cumulative merger expenses reduced to approximately $5.5 billion from $7.9 billion;
on track to achieve $5.0 billion annual run-rate cost savings by completion of integration in 2011
- Cross-sell revenues already being realized
- Credit overall performing in line with original expectations
- First state community bank conversion (Colorado) scheduled for November; conversion of
remaining overlapping markets expected in 2010
=> good!!
• Increased loan modifications
- Provided 62,989 trial and completed modifications through the Home Affordable Modification
Program (HAMP) and 292,005 through Company’s proprietary programs, bringing total this year through September 30, 2009, to 354,994
- Refinanced 987,000 customers’ mortgages using the Home Affordable Refinance Program
(HARP) and other standard refinance programs
- Over 20 percent of PCI Pick-a-Pay portfolio modified through September 30, 2009, with positive early performance
=> mortgage application down 11% last month, but the trend is still going up and I am sure the house market has hit the bottom even though house price rise slowly in the coming year, may upset lots of analysts and economists.
Subscribe to:
Posts (Atom)