东盟银行业手册：全球再加速定位

1、Global Research1 April 2019EquitiesASEAN Banks HandbookAsiaPositioning for a global re-accelerationHow to think about ASEAN banks for the rest of 2019?ASEAN banks performance has recovered somewhat this year. But so far rerating has driven this. Earnings havent contributed, yet. However UBS Economic

2、s HYPERLINK /shared/d2Vn88yacY4XHW expects a synchronized growth pickup Q2 onwards, early signs of which are visible. Our Asian strategy team HYPERLINK /shared/d28c9n2JsVrTpS expects Asian earnings to trough in Q2. We believe Singapore banks could benefit most from this recovery. Singapore GDP has t

3、he highest sensitivity to G3 growth. Moreover valuation, HYPERLINK /shared/d2MpVCN0fJ depressed due to trade related headwinds, looks most attractive among ASEAN banks HYPERLINK l _bookmark38 (Figure 84). In the Philippines and Indonesia, policy HYPERLINK /shared/d2c9dhAIW4ulI easing could help earn

4、ings momentum for banks, just like in 2012/16. HYPERLINK l _bookmark34 Valuations do not look demanding for the Philippines banks, but expensive for Indo. In Thailand, while valuations dont look stretched, a catalyst to turn the weak earnings is missing. In Malaysia, the sector P/E still looks high

5、and hard to justify given deteriorating earnings and more cautious asset quality outlook. Our new quantitative ranking framework suggests an overweight on Singapore and Philippines banks, neutral Indonesian banks and underweight on Thailand and Malaysian banks.Can price leadership change in the next

6、 3-5 years?Multiple normalization can be a significant driver of returns in the next 3-5y. The credit cycle downturn in the last 5 years across ASEAN drove wide gaps in multiples (P/PPOP) despite similar underlying profitability trends (PPOP to assets). E.g. BCA trades at 20 x P/PPOP while BRI (UBS

7、key call) & Mandiri at 7-8x. While these gaps are unlikely to close imminently, some normalization is likely to happen as asset quality normalizes. Returns from HYPERLINK /shared/d2bCSXBiEPT BRI (or Mandiri) can be significantly higher vs. BCA in coming years. In Singapore, DBS (UBS key call) trades

8、 at similar multiple as peers despite better PPOP/asset trend, and is structurally our top pick, as discussed HYPERLINK /shared/d2poDQ8dWzQQMFb here. A more detailed discussion HYPERLINK l _bookmark8 inside.Contrarian views on asset quality in the Philippines and MalaysiaWe update our interest cover

9、age ratio (ICR) HYPERLINK l _bookmark30 framework readings are most noteworthy for the Philippines and Malaysia. Many investors worry about asset quality risks in the Philippines due to late cycle concerns. Our framework still suggests a benign outlook (contrarian). A dovish central bank and policy

10、easing this year should also further help alleviate some concerns. In Malaysia, the steep decline in the ICR suggests more caution, in contrast to the benign guidance which many investors seem to agree with.What stocks to own?We prefer DBS and OCBC (OCBC looks tactically most attractive today) vs UO

11、B in Singapore; BPI and MBT vs BDO among the Phil. big banks. Security bank is also a top pick among the mid-cap banks. In Indonesia, we prefer BRI (and Mandiri) among the big banks and BTN among the smaller ones. In the least preferred markets, we prefer CIMB vs. Public & Maybank in Malaysia, and B

12、BL & KBANK vs. KTB in Thailand.Figure 1: ASEAN banks preference ranking frameworkAakash Rawat, CFAAnalyst HYPERLINK mailto:aakash.rawat aakash.rawat+65-6495 8283Edward TeatherEconomist HYPERLINK mailto:edward.teather edward.teather+65-6495 5965Joshua Tanja, CFAAnalyst HYPERLINK mailto:joshua.tanja j

13、oshua.tanja+62-21-2554 7030Worawat Saisuphatphol, CFAAnalyst HYPERLINK mailto:worawat.saisuphatphol worawat.saisuphatphol+662-613 5717Igor Putra Analyst HYPERLINK mailto:igor.putra igor.putra+62-21-2554 7033Source: UBS estimates HYPERLINK /investmentresearch /investmentresearchThis report has been p

14、repared by UBS Securities Pte. Ltd. (Reg. No. 198500648C). ANALYST CERTIFICATION AND REQUIRED DISCLOSURES BEGIN ON PAGE 56. UBS does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that coul

15、d affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.ASEAN BanksUBS Research THESIS MAP MOST FAVOREDLEAST FAVOREDDBS, OCBC, BPI, SECB, BRI, BTNBNI, Maybank, KTBPIVOTAL QUESTIONSQ: How will loan growth fare this yea

16、r?Loan growth momentum in Indonesia has since last year outpaced peers. Our Indonesia banks team latest study suggests a slowdown now. We believe sharply slowing loan growth in Singapore could surprise positively this year. We also see scope for positive surprise in the Philippines vs. currently cau

17、tious guidance. HYPERLINK l _bookmark11 more Q: Where can earnings surprise or disappoint this year?We see scope for positive earnings surprises in Singapore, Philippines and Indonesia (potentially later than the other two), and negative surprise in Malaysia. HYPERLINK l _bookmark25 more Q: How to t

18、hink about asset quality?Most noteworthy and contrarian conclusions from our framework are in the Philippines and Malaysia. We are more positive in Philippines but more cautious in Malaysia vs. general consensus. HYPERLINK l _bookmark28 more UBS VIEWPosition for global re-acceleration. We expect ear

19、nings surprises for banks in Singapore, Philippines and Indonesia this year. Keeping valuations and other macro considerations in context this leaves us overweight Singapore and the Philippines and neutral Indonesia. We struggle to see a catalyst that helps turnaround the weak earnings momentum in T

20、hailand and are underweight Thailand banks in ASEAN. We are also underweight Malaysia banks where a combination of slow growth and potentially a more challenging asset quality environment makes us cautious.EVIDENCEWe form our conclusions using a quantitative ranking framework that capture our outloo

21、k on earnings, valuations, policy/macro and sentiment/flows for ASEAN banks. In addition we use several models that help us estimate GDP sensitivity to global growth, impact of policy easing on EPS and aggregate interest coverage ratio for non-bank corporates.WHATS PRICED IN?In Singapore, valuations

22、 are suggesting a gloomy growth outlook and are not reflecting any possibility of a pickup. Similarly in the Philippines, valuations look undemanding and reflect concerns around a slowdown. In Malaysia, the high P/E for the sector doesnt reflect any concerns around asset quality. In Thailand, valuat

23、ions look undemanding but we dont see any catalyst for that to change. In Indonesia, valuations look on the expensive side and pricing in a lot of the good momentum. HYPERLINK l _bookmark35 more 1. GDP Sensitivity to global growth is the highest in Singapore. 2. How earnings estimates for banks resp

24、onded to monetary policy easing in the Philippines in 2012/16GDP sensitivity to global growthPH banks: future change in policy rate and EPS6050403020100Value added exports to GDP (2014) (lhs)3.53.02.52.01.51.00.50.040%30%20%10%0%-10%-20%-30%-40%Philippines banksPR (12m futur e change, ppt , RHS) EPS

25、 (12 m future change, LHS)21.510.50-0.5-1-1.5-21/1/2010 8/1/2011 3/1/2013 10/1/2014 5/1/2016 12/1/2017ASEAN BanksUBS ResearchHow to position for a global re-acceleration? HYPERLINK l _bookmark0 return Figure 2: Key aggregate guidance and estimates for ASEAN banksLoan growthNIM changeCredit costs (bp

26、s)ROETop PickSystem level guidanceUBSe(UBSe, big banks aggregate)(UBSe, aggregate for the big bank UBSe20182019E2019E20182019E2020E20182019ESingapore5.3%5-6%+ 3-5 bps16212311.6%11.8%DBS, OCBCMalaysia5.6%5-6%- 5-10 bps25313811.0%10.6%CIMBIndonesia12%11%Fla4%15.6%BRI, BTNThailand6%5-6%Fla

27、t / slightly up1441411329.7%9.8%BBL, KbankPhilippines15%12%+ 15-25 bps4149528.8%9.8%BPI, MBTVietnam14%14%Flat / slightly up20320020719.5%19.3%MBBSource: Company data, UBS estimatesA few things have helped ASEAN banks fare better so far this year vs. last. A more dovish FED outlook helped ease risk a

28、version towards Emerging markets, in particular markets with widening current account deficits like Indonesia and the Philippines. Reversal of domestic policy and inflation headwinds helped Philippines equities. More positive developments on the US-China trade war helped the more trade exposed econo

29、mies in the region like Singapore.Figure 3: ASEAN bank annual performance (US$)Figure 4: ASEAN banks price and EPS index6%9%-24%1%49%-9%3%-14%37%41%-10%-16%-5%42%-24%-2%-20%16%18%48%-3%8%-23%30%-38%30%28%-16%0%-1%-17%-27%-3%3%-3%US$ returns2013 2014 2015 201620172018 YTDSingapore Philippines Indones

30、ia Thailand MalaysiaSource: Datastream180 ASEAN bank price index (USD)ASEAN banks EPS index (12m forward, RHS)1308030-20Dec-98 Jul-01 Feb-04 Sep-06 Apr-09 Nov-11 Jun-14 Jan-17Source: Datastream, UBS estimates1801308030-20But this recovery so far has been driven by rerating. Forward looking (12 month

31、s) earnings estimates have hardly moved in the last 6 months or so at an aggregate level for ASEAN banks.In fact estimates for 2019 EPS for ASEAN banks have declined by 3-4% in the last 6 months. This momentum looks better for 2020 and overall decline in the EPS forecast for ASEAN banks has been 70b

32、ps or so in the last six months.The downgrades appear to have mainly come from growth expectations based on the revised guidance from the banks across the region. However this is an area where we think there is a risk of being too cautious today.But this recovery so far has been driven by rerating.E

33、stimates for 2019 EPS for ASEAN banks have declined by 3-4% in the last 6 months.Figure 5: Loan growth guidance for 2019 vs 2018 actualFigure 6: Loan growth: latest vs. 201816%14.9%Loan growth ( local currency)16%14.9%Loan growth ( local currency)14%12%12.0%2019 guidance201811.7%11.0%14%12%13.3%Late

34、st y/y201811.9%11.7%10%8%6%4%2%0%6.1% 6.0%5.0%5.6%5.3%3.3%PhilippinesIndonesiaThailandMalaysiaSingapore10%6.0% 6.0%5.5% 5.6%5.0%5.3%8%6%4%2%0%PhilippinesIndonesiaThailandMalaysiaSingaporeSource: UBS estimates, company guidanceSource: CEICUBS Asian strategy team expects growth to improve sequentially

35、. Data in Asia and especially China has been weak so far, but in line with what our China economics team has been HYPERLINK /shared/d2nowHUhgeceFq5/ expecting. Our Asian strategy team HYPERLINK /shared/d2Dk8KHAb9eHjo1/ argues that a bottom in earnings is likely to be a Q1/Q2 event Q1 the absolute bo

36、ttom in earnings, data releases and subsequent earnings changes happen in Q2.Our global economics team has also HYPERLINK /shared/d2QlSrmczoZ/ noted increased risk of recession, but their base case remains that growth likely picks up. Our global team have more recently HYPERLINK /shared/d2OBWy14tnsQ

37、M noted more convincing and mounting evidence signs of data improvement across Europe and EM. This is yet to happen in US and Asia though.Within EM its noticeable that Asia ex-India/China is not participating in the rebound so far, consistent with the weakness in the trade cycle. But this is expecte

38、d to turn around soon (irrespective of whether tariffs get rolled back) which should further solidify the rebound.This should set the stage for a global re-acceleration in growth in Q2. For the detail, and a fuller breakdown of whats behind the global improvement please see the Global economics HYPE

39、RLINK /shared/d2OBWy14tnsQM note.Looking at overall earnings and performance for banks, 2018 looks similar to 2011 and 2013 the last two episodes when macro concerns drove share prices down but earnings remained resilient.In 2011 earnings estimates rose by 6% (following a 29% rise in 2010). In 2013

40、they were flat after a 20% improvement in 2012. In both 2011 and 2013, share prices in aggregate were down 7-8% just like in 2018 when they were down 7% for the sector overall.If the view of our global macro team that a stronger recovery in growth and earnings should happen through the rest of the y

41、ear is correct, that could make 2019 look similar to 2012 or 2014 (the two years following the years when macro concerns drove share prices down but earnings were much more resilient just like in 2018). In both 2012 and 2014, there was pickup in earnings and share prices recovered alongside.There ha

42、s been convincing and mounting evidence signs of data improvement across Europe and EM. This should set the stage for a global re-acceleration in growth Q2 onwards2019 look similar to 2012 or 2014 when EPS and performance recovered12m fEPS changePerformancebroad based policyeasing support presentsim

43、ilar to 2012 or 2014?macro concerns (taper tantrum,Euro crisis fears, US debt downgrade)broad based policyeasing support missingFigure 7: ASEAN banks aggregate price and EPS change (12m forward, cons.)100%80%60%40%20%0%-20%-40%-60%20002001 2002 2003 2004 2005 2006 200720082009 2010 2011 2012 2013 20

44、14 20152016 2017 2018 2019Source: DatastreamThe key difference between 2012 and 2014 was policy support. In 2012 there was much stronger policy support and policy rates were being cut in Indonesia, Philippines and Thailand, and the Fed was on hold. In 2014, similar policy easing support was missing.

45、 Rates were steady in Indonesia, were hiked a couple of times in the Philippines (they were only still declining in Thailand though). There was a rate hike in Malaysia.This year we are once again now expecting policy support. And easing policy is likely to help with a turn in earnings momentum for t

46、he banks. This is not different from the past experience in Indonesia and the Philippines. If we look back, in both Indonesia and the Philippines, policy easing helped with a turnaround in earnings momentum for the banks in the last two episodes.In both Indonesia and the Philippines, policy easing h

47、elped with a turnaround in earnings momentum for the banks in the last two episodesFigure 8: Philippines: future change in policy rate and EPS for banks PR (12m future change, ppt, RHS) EPS (12m future change, LHS)Philippines banks210-140%30%20%10%0%-10%-20%-30%Figure 9: Indonesia: future change in

48、policy rate and EPS for banks PR (12m future change, ppt, RHS)Indonesian banksEPS (12m future change, LHS)40%330%220%10%10%0-10%-1-20%-30%-2-40%01/01/201001/05/201201/09/201401/01/2017Source: Datastream, CEIC-2-40%01/01/201001/05/201201/09/2014Source: Datastream, CEIC-301/01/2017 HYPERLINK l _bookma

49、rk1 Figure 8 & HYPERLINK l _bookmark2 Figure 9 show the 12 month future change in policy rates alongside the change in the EPS (12m forward consensus estimate). The future change in the policy rate in the chart includes 50bps cuts by the end of 2019 (UBS forecast).Moreover, we also think there is a

50、risk of being too cautious on growth estimates today. For example, in the Philippines the outlook for loan growth (12% y/y) this year looks more cautious than is warranted (to us). A sudden rise in funding costs in Q4 alongside higher interest rates diminished the appetite for loans at the big banks

51、 and might be one reason for this cautious guidance, in our view.In the Philippines the outlook for loan growth (12% y/y) this year looks more cautious than is warranted.However at the same time the HYPERLINK /shared/d2T9Xbgjq9f3 guidance also suggests that corporate demand has remained fairly resil

52、ient despite the rise in policy and lending rates last year. Potentially easier monetary policy (UBS expects 2 rate cuts this year) should reverse some of this pressure and ease concerns around slowing growth and can help loan growth pickup in 2019.Both elections and falling inflation are positives

53、for consumption and can lead to more buoyant consumer loan growth (including Autos which was very poor) than last year. Please see HYPERLINK /shared/d2mnDrHdMofdnWT UBS Evidence Lab inside: Philippines - The big consumer HYPERLINK /shared/d2mnDrHdMofdnWT comeback.In addition, Philippines still has t

54、he lowest LDR in the region. With two or more RRR cuts on the table for this year, the banking system should have ample room for growth, unlike most other ASEAN markets where this level is quite high. The risk to this view is of course the crowding out by the government sector (not our base case).60

55、50Value added exports to GDP (2014) (lhs)Beta to acceleration/deacceleration in G3 GDP since 2000 (rhs)3.5403.02.52.0301.5201.0100.500.0Figure 10: Lower inflation - BSP cut rates (Philippines)Figure 11: GDP sensitivity to global growthSource: UBS EconomicsSource: UBS EconomicsSingapore is the second

56、 market where we think there is a chance that growth surprises this year (or at the least expectations of that build up and drive share prices later this year). Singapore has the highest beta to acceleration in global GDP among the ASEAN (and Asian) markets.If our macro view is correct and we see a

57、synchronized recovery in global growth in the second half of this year, Singapore should benefit the most and the banks guidance of 5% for loan growth this year could prove to be on the conservative side. The disconnect between fundamentals and valuations also looks most extreme for banks in Singapo

58、re in ASEAN and as we have HYPERLINK /shared/d27v9DHHvko argued seems to be largely “a COE problem, not a ROE one”. The uncertainty around the trade issues seem to be driving this risk premia and depressed valuations as shown by the results of the HYPERLINK /shared/d2bqFHa5A0AhPBo market thinking ga

59、me.We are less confident of this happening in the context of Malaysia or Thailand and as a result expect less room for growth surprise in those two markets. In addition to the weak cyclical momentum and missing catalyst for that to turn around, the high level of leverage, household credit in particu

60、lar, poses a structural headwind for any strong releveraging and pickup in consumer loan growth in these markets.Singapore is the second market where we think there is a chance that growth surprises this yearWe see less room for growth surprise in Malaysia and Thailand this yearFigure 12: Household