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2013 Earnings are In … The Winners are…
We have examined the earnings, NPLs, credit growth, and NIMs. Main findings are:
Chinese bank earnings for the big banks will come in this week and we know what they will be, This wildfire of negativity could spark a rally from severely depressed levels. I have never seen sentiment worse on Chinese financials.
In the US, the numbers for the banks are the best globally. NPLS have dropped by 40% and are now a real 1.5%.
The UK is a disaster. Losses continued while NPLS dropped. 2011-2013 income for the UK banks was USD -16 Bn. Lending continues to shrink.
In Europe, the numbers are also grim, except for France. Europe has half of the world’s NPLs.
In Japan, the BOJ has stalled on moral suasion and actual movement. So, the TOPIX peaked exactly on January 1 and has been drifting.
In the rest of Asia, the NPLs of 1.2% are now turning suspect. LDRs are peaking at 1 in many countries, thus hampering growth.
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