Financial Industry 06 (Jun 16 - Dec 18)

Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Fri Oct 13, 2017 9:02 am

Nine banks face struggle: IMF

by Dominique Nguy

The International Monetary Fund named nine banks that could struggle in coming years to remain sufficiently profitable.

They are Deutsche Bank, Citigroup, Barclays, Societe Generale, UniCredit Group, Standard Chartered, Sumitomo Mitsui Financial Group, Mizuho Financial Group and Mitsubishi UFJ Financial Group.

"About a third of banks by assets may struggle to achieve sustainable profitability, underscoring ongoing challenges and medium-term vulnerabilities," said IMF in its biannual Global Financial Stability Report.

IMF said consensus among private sector bank analysts was the return on equity for each of those nine banks in 2019 might be less than 8 percent.

Meanwhile, the IMF said the global economic recovery has strengthened financial stability but easy monetary and financial conditions against a backdrop of sluggish inflation is elevating medium-term risks.

The IMF also noted risks are rotating from banks, which have fortified their balance sheets, to financial markets as credit spreads compress, volatility declines and asset prices rise.

"While increased risk appetite and search for yield are a welcome and intended consequence of unconventional monetary policy measures . . . there are risks if these trends extend too far," the IMF said.

Source: The Standard

http://www.thestandard.com.hk/section-n ... 1013&sid=2
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Fri Oct 13, 2017 2:28 pm

not vested

Frightful ETFs to Flee: Direxion Daily Regional Banks Bear 3X ETF (WDRW)

The Direxion Daily Regional Banks Bear 3X Shares (NYSEARCA:WDRW) is a big bet that U.S. regional banks are headed for Armageddon.

The ETF invests primarily in synthetic and derived securities structured to track the inverse performance of the Dow Jones Select Regional Banks Index as opposed to the market standard KBW Nasdaq Regional Banking Index.

But if that isn’t bad enough for investors buying this ETF, it is internally leveraged in its securities to perform three times the inverse of its tracked index.

That has resulted in losses so far this year of over 25% and for the trailing year by more than 66%. And for those masochistic investors holding this for the past five years have endured losses of over 84%.

And it should get even worse in the months to follow.

First, banks in the U.S, are faring better and better. The Federal Reserve Bank has been largely steady in its targets for Fed Funds creating less uncertainty for banks asset and liability folks.

And even with the unwinding of the trillions of dollars in its bond-buying program, the market continues to see a very limited amount of bonds coming to the market.

And if anything, the minor impact on the yield curve might well favor banks’ new lending portfolios with slightly higher yields for longer-term loans.

Second, regional banks are seeing the benefits of the new administration and its view on regulation. Bank lobbyists are pushing for and receiving easier reviews from Federal and state regulators as a boon for the U.S. economy.

And with the new Fed’s Vice Chair for regulation appointed and confirmed, Randal Quarles is expected to be the ultimate banker’s friend when it comes to enforcing Fed rules.

Third, with the U.S. economy expanding regional banking lending in projects from infrastructure to construction will continue to rise adding to profitability. And the built it and buy it in America push can only help regional banks. And regional banks in rural America should also be beneficiaries of USDA expansion of rural development spending.

Regional banks make for a great bet, the Direxion Daily Regional Banks Bear 3X ETF continues to be a pitiful punt.

Source: Investor Place
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Fri Oct 13, 2017 7:34 pm

ONE SECTOR IS EAGER FOR TRUMP'S TAX PLAN

Today's chart highlights a sector that's hungry for policy changes...

We like to check in on America's big financial players from time to time. Firms like Wells Fargo (WFC), Bank of America (BAC), Berkshire Hathaway (BRK-B), Citigroup (C), and JPMorgan Chase (JPM) act as America's "financial backbone."

They rise and fall with our country's ability to make money, service debts, and generally "just get along." And right now, financial stocks are on a tear...

The Financial Select Sector SPDR Fund (XLF) is heavily weighted toward America's banking juggernauts... The five firms we listed above make up a massive 44% of its holdings.

Banks generally shoulder a large tax burden. But if President Donald Trump's new tax proposal succeeds, some estimates say that big banks could see their profits increase by as much as 20%.

As you can see in the chart below, financials soared after the presidential election stoked hopes for bank-friendly policies. The fund is up 34% in the past year... And shares climbed 7% this month alone.

Source: Daily Wealth
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Fri Oct 13, 2017 7:53 pm

European banks still hold €988 billion euros in nonperforming loans: IMF

By Greg Robb

Italian banks should be able to sell €65 billion in nonperforming loans this year and sales by Spanish banks should account for an additional €30 billion reduction, he said.

In Portugal, the level of nonperforming loans remains very high, falling to 15.5% of total loans in the second quarter after peaking at around 18% last year,


Source: Market Watch

http://www.marketwatch.com/story/europe ... yptr=yahoo
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Fri Nov 10, 2017 8:04 am

There are a bunch of signs that China's banks will grow even stronger

The prospects for China's big four banks are getting better, going by their latest earnings reports and other official data

The improvement came on the back of a "successful financial deleveraging" and "resilient economic performance," Nomura said

Investors had anticipated progress in several aspects of business, sending the banks' shares rallying for most of this year

their shares are still trading at a discount compared to many of their peers in the U.S., Europe and Japan.


The rising rates environment is also benefiting the banks in another way: net interest margin (NIM), the measure of lending profitability, has shown signs of picking up.

Foreign investors have so many concerns: the debt, the overcapacity, the environment, the corruption or the wealth disparity.


Source: CNBC

https://www.cnbc.com/2017/11/09/china-b ... KW,14NHU,1
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Fri Dec 15, 2017 2:07 pm

China: <Research Report>Deutsche: De-leveraging of Mainland Financial Regime Still Continues; Prefers Large CN Banks

Deutsche Bank said in its report that the financial de-leveraging process is still ongoing in Mainland China despite further easing of credit and bank assets growth.

In a tightening and more coordinated regulatory environment, the research house preferred large banks, with top picks BANK OF CHINA (03988.HK), ABC (01288.HK) and CCB (00939.HK) with ratings Buy and target prices of $4.78, $4.1 and $7.68.

Source: AAStocks Financial News
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Sat Jan 13, 2018 8:32 am

China’s banks stand to earn US$63b in revenue by 2020 from financial inclusion, says EY

Banks in the mainland stand to benefit most from ‘financial inclusion’, which represents potential global revenue of US$200b across 60 countries

China’s banks could lose up to US$63.4 billion in revenues by 2020 if they did not make good use of fintech to serve the traditionally unbanked and underbanked customers.

About two billion people around the world have no access to financial services and more than 50 per cent of the adults in the poorest households are unbanked.

More than 200 million micro, small and medium enterprises in emerging markets, or more than half of the global pool, have no access to banking services. A large concentration of them are in five markets – China, Brazil, India, Columbia and Thailand.

Technology-led innovation, such as e-payments, national digital identity systems, credit data infrastructure, open access to digital data, currency digitisation, and basic education on financial offerings, becomes crucial to connect with those who have been financially excluded.

Retail bank account penetration currently at 65 per cent across Asia-Pacific was expected to rise to 74 per cent by 2020.


Source: SCMP

http://www.scmp.com/business/banking-fi ... -financial
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Re: Financial Industry 06 (Jun 16 - Dec 17)

Postby winston » Mon Jan 22, 2018 7:57 am

China: Investors bet Chinese bank stocks have further to go as economy improves, bad loans fall

Analysts from China’s top brokerages predict the steadfast gains in banking stocks so far this year will continue amid improving economic growth

China’s listed commercial banks are valued at an average of 1.14 times their book value compared with 1.37 times for the global lenders.

In terms of price earnings ratio, Chinese banks are half as expensive as their global counterparts.

China’s slowing growth, coupled with dwindling external demand and excessive output in industrial products from coal to steel, prompted investors to sell the stocks fearing a rise in bad loans.


Source: SCMP

http://www.scmp.com/business/china-busi ... go-economy
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Re: Financial Industry 06 (Jun 16 - Dec 18)

Postby winston » Thu Feb 01, 2018 7:35 am

What this early warning sign is saying about the ‘Melt Up’ today

by Dr. Steve Sjuggerud

Financial stocks had a great 2017. And they’re starting 2018 off strong, too. The sector recently hit a 52-week high.

And history says the rally should continue from here. That’s good for the sector and for the overall market.


Source: True Wealth

http://thecrux.com/chart-a-good-sign-for-the-melt-up/
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Re: Financial Industry 06 (Jun 16 - Dec 18)

Postby winston » Fri Mar 02, 2018 3:32 pm

<China: Research Report>UBS Expects CN Banks 4Q17 Profit Growth to Quicken to 7.4%; Widened NIM Backs Income Rise

Chinese banks will unveil within this month their annual results for last year.

UBS envisioned their results to improve continuously and profit acceleration to sustain in 4Q17 with expected growth at 7.4%, primarily driven by robust net interest income increase. [b]

UBS latest ratings and target prices on Chinese banks:

Shares/Ratings/Target prices (HK$)
CCB (00939.HK)/Buy/11.5
ICBC (01398.HK)/Buy/9.2
CM BANK (03968.HK)/Buy/43.6
CQRC BANK (03618.HK)/Buy/7.0
BANKCOMM (03328.HK)/Neutral/6.3
BANK OF CHINA (03988.HK)/Neutral/4.2
ABC (01288.HK)/Neutral/3.9
HUISHANG BANK (03698.HK)/Sell/3.6

Source: AAStocks Financial News
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