Big cap GEM Bank investment recommendations for 2024

Financials

Galliano's Financials Research

Victor Galliano favours four longs and one short as his conviction calls for the year ahead. 1) Bank Mandiri (Indonesia) continues to generate improving returns and has strong capital ratios, credit quality and liquidity metrics. 2) KB Financial (South Korea) is a deep value pick. 3) China Merchants Bank is a contrarian pick, which looks well positioned to confront concerns re. Chinese NPLs and also on very attractive valuations. 4) Banco do Brasil screens well re. valuations and returns; its growth potential also looks particularly appealing. 5) Victor’s key sell is Kotak Mahindra Bank (India) as it is richly valued, exposed to low prospective earnings growth and has low credit quality coverage.

- 12 January, 2024

Chinese Banks: Focusing on the credit quality challenge

Financials

Galliano's Financials Research

Victor Galliano conducts a credit quality review of eleven Chinese banks in the light of the Evergrande and real estate sector headwinds - he also assesses the banks’ profitability ratios and their capacity to absorb increasing credit losses. Victor considers the best placed banks to be China Merchants Bank and PSBC; the most exposed to further credit quality deterioration are China Minsheng Bank and China CITIC Bank.

- 29 October, 2021