The results of Grant Thornton's 'Restructuring Outlook for 2012' survey provide insights into the factors that lead to corporate underperformance, the restructuring strategies that are commonly employed and how these strategies are likely to evolve in 2012. The briefing also provides an overview of the sectors considered particularly vulnerable in the current climate.
Merrill Lynch Global Power and Gas Conferencefinance14
This document summarizes Merrill Lynch's presentation at the 2008 Power & Gas Leaders Conference in New York on September 23, 2008. Some key points:
- Exelon is well positioned financially, with strong operations, a robust hedging program, and ample liquidity.
- Exelon's 2009 operating EPS is expected to be flat compared to 2008, as higher earnings from ComEd offset lower earnings from Exelon Generation.
- Exelon is uniquely positioned for sustainable value through its large nuclear fleet, competitive markets, and opportunities for growth.
Thiet ke Bao cao thuong nien - Mhb 2009Viết Nội Dung
This document is Mekong Housing Bank's (MHB) annual report for 2009. It summarizes 7 outstanding events that occurred in 2009, including establishing a customer care center and online customer service network. It reaffirms MHB's mission to be a leading bank for financial advice and customer service. The Chairman's statement discusses the challenges of the global financial crisis and Vietnam's economic difficulties in 2009. However, MHB was still able to achieve its business plan by following the government's economic stimulus policies and maintaining financial stability and social support. The Chairman expresses confidence that with continued strategy execution, 2010 will bring both challenges and opportunities for MHB to modernize operations with its new core banking system.
To
help senior executives weather this economic storm, the Economist Intelligence Unit has updated its
answers to some of the questions most frequently asked by clients, following the publication of the
four previous editions of Global crisis monitor. In answering each question, we outline our current
forecast, explain our thinking, and highlight any key risks or alternative scenarios.
The banking sector in Malaysia saw stable loan growth of 10.9% year-over-year in March 2009, driven partly by a 20-30% jump in loans to government agencies and non-bank financial institutions. However, leading loan indicators remained subdued and loan growth is expected to slow significantly to 2-3% in 2009 due to weaker economic conditions. Non-performing loan ratios continued to improve in March. The report maintains a neutral outlook on Malaysian banks, expecting them to perform better than anticipated despite the economic downturn.
Based on proprietary data and analytic insight, this report gives Dun & Bradstreet's perspective on gloal business conditions for the first half of 2012.
The document discusses global headwinds for the Black Sea region. It notes that the global outlook has darkened, especially in Europe, with high recession risks. This poses downside risks for the Black Sea region in the near term and could undermine long-term growth prospects by putting pressure on currencies and banks and exacerbating any domestic vulnerabilities. However, policy space in the Black Sea region remains constrained to respond to these challenges.
Merrill Lynch Global Power and Gas Conferencefinance14
This document summarizes Merrill Lynch's presentation at the 2008 Power & Gas Leaders Conference in New York on September 23, 2008. Some key points:
- Exelon is well positioned financially, with strong operations, a robust hedging program, and ample liquidity.
- Exelon's 2009 operating EPS is expected to be flat compared to 2008, as higher earnings from ComEd offset lower earnings from Exelon Generation.
- Exelon is uniquely positioned for sustainable value through its large nuclear fleet, competitive markets, and opportunities for growth.
Thiet ke Bao cao thuong nien - Mhb 2009Viết Nội Dung
This document is Mekong Housing Bank's (MHB) annual report for 2009. It summarizes 7 outstanding events that occurred in 2009, including establishing a customer care center and online customer service network. It reaffirms MHB's mission to be a leading bank for financial advice and customer service. The Chairman's statement discusses the challenges of the global financial crisis and Vietnam's economic difficulties in 2009. However, MHB was still able to achieve its business plan by following the government's economic stimulus policies and maintaining financial stability and social support. The Chairman expresses confidence that with continued strategy execution, 2010 will bring both challenges and opportunities for MHB to modernize operations with its new core banking system.
To
help senior executives weather this economic storm, the Economist Intelligence Unit has updated its
answers to some of the questions most frequently asked by clients, following the publication of the
four previous editions of Global crisis monitor. In answering each question, we outline our current
forecast, explain our thinking, and highlight any key risks or alternative scenarios.
The banking sector in Malaysia saw stable loan growth of 10.9% year-over-year in March 2009, driven partly by a 20-30% jump in loans to government agencies and non-bank financial institutions. However, leading loan indicators remained subdued and loan growth is expected to slow significantly to 2-3% in 2009 due to weaker economic conditions. Non-performing loan ratios continued to improve in March. The report maintains a neutral outlook on Malaysian banks, expecting them to perform better than anticipated despite the economic downturn.
Based on proprietary data and analytic insight, this report gives Dun & Bradstreet's perspective on gloal business conditions for the first half of 2012.
The document discusses global headwinds for the Black Sea region. It notes that the global outlook has darkened, especially in Europe, with high recession risks. This poses downside risks for the Black Sea region in the near term and could undermine long-term growth prospects by putting pressure on currencies and banks and exacerbating any domestic vulnerabilities. However, policy space in the Black Sea region remains constrained to respond to these challenges.
1) The document discusses Bank of America's enterprise risk management strategies and capabilities. It highlights how the bank manages various types of risk, including credit, market, and operational risk across its consumer and commercial businesses.
2) Key strengths that help the bank manage risk include its breadth of client access, industry insights, and integrated risk management structure.
3) The bank has improved its risk profile by rebalancing its commercial credit portfolio and enhancing risk monitoring tools.
BANKING Mar 09 Statistics Some ResilienceBoyboy cute
Positive signs. Loan disbursements, repayments, applications and
approvals rebounded with strong double-digit MoM growth, flattish-tolow-
teens YoY growth, and in absolute term, were back to pre-Aug/Sep
’08 levels. Absolute NPLs continued to inch lower, mainly from the
working capital segment. Nonetheless, it is early to tell whether these
are sustainable as global fundamentals remain weak.
Strong loan disbursements and repayments. Banking loans (net of
repayments) grew to RM733.9m in Mar ’09 (+0.6% MoM, +10.9% YoY)
on expansion in both household (+0.4% MoM, +8.8% YoY) and
business loans (+0.9% MoM, +9.5% YoY). The pace of disbursements
and repayments was strong (disbursements: +27.4% MoM, +9% YoY;
repayments: +15.7% MoM, +4.8% YoY), mainly for working capital.
YTD loans growth was +1% (household: +1.5%, business: +0.5%).
Forward indicators bounced MoM but still flattish YoY. Loan
applications and approvals also rebounded strongly: +24.3% MoM and
+35.3% MoM respectively. On a YoY comparison, loan applications
were up 4.7%, driven by household loan applications (+21.5%), mainly
for home purchases, which off-set lower applications from businesses
(-11%). Overall loan approvals were rather flattish YoY, with approvals
up for household loans (+12.6%) but down for business loans (-13%).
Absolute NPLs contracted further. Absolute gross NPLs continued
to inch lower, at a slightly higher pace of -3.7% MoM to RM33.6b (Feb
‘09: -0.04% MoM). On a 3-month comparison (see table in page 4),
the lower NPLs came mainly from the working capital segment,
reflecting perhaps resilient business strength. Meanwhile, net NPL ratio
was little changed at 2.24% (Feb ‘09: 2.23%).
Remain Underweight. YTD loans growth, if sustained, should lead to
the upper end of our 2-3% loans growth forecast for 2009. Our other
assumption is for absolute NPLs to expand by 50% YoY by end-2009,
leading to a projected 10% decline in combined net profit for 2009.
While loans quality was resilient in Mar ’09, we remain concerned over
rising NPLs – our analysis shows a 3-6 months interval from GDP
trough to NPL peak. The other main risk is a protracted economic
slowdown leading to rising unemployment and asset deflation.
The document discusses the implications of Hungary's accession to the EU on its investment management industry. It provides background on the development of Hungary's financial services and investment management industries. The investment management industry grew slowly in the 1990s and more rapidly in the late 1990s. Assets under management increased annually by 23% between 1997-2002. The EU accession will significantly impact the Hungarian investment management industry by leveling the regulatory playing field and allowing more competition from foreign investment managers and funds. This may challenge domestic investment managers.
VTB Capital "Russia Calling: London Session May-June 2011MRSK Centre
The document provides an overview of IDGC Capital's 2010 results and 2011 forecast. It highlights the company's strong growth across key financial metrics like revenue, EBITDA, and net profit between 2008-2011. Capitalization is forecast to grow at a CAGR of 64% during this period. The company has a large network across central Russia and implemented a KPI system to improve efficiency under RAB regulation. Prospects for continued growth are seen through lower depreciation and sector undervaluation relative to foreign peers.
The budget focuses on fiscal consolidation and boosting growth. It marginally increases tax deductions but also raises some taxes. Funding is enhanced for infrastructure through tax-free bonds and ECB changes. The power sector may benefit from coal duty exemptions and FSA commitments. However, the auto sector faces higher excise duties that could impact large carmakers. Key assumptions around GDP and oil prices make deficit targets optimistic. Overall policy measures only partially address issues around land, environment and state electricity boards.
The document discusses three potential paths for markets in 2013: a base case, bull case, and bear case. The base case, which has a 55-65% probability of occurring, involves a compromise deal between Democrats and Republicans to modestly mitigate the fiscal cliff and result in low single-digit returns. A bull case involves a long-term fiscal solution, while a bear case risks recession if a deal is not reached. The path taken will depend on negotiations in the lame duck session and early 2013.
Weakness ahead. Loan disbursements, applications and approvals
slowed in Apr, reflecting cautious sentiment. Loans growth was just
1.4% YTD, and 4.2% annualised. There was a slight uptick in absolute
NPLs, implying stress in some loans segments. The poor 1Q09 GDP
numbers suggest growing stress in system loans over the next few
months. We remain cautious on banks’ profits, especially from 3Q09.
1.4% YTD loans growth. Banking loans (net of repayments) grew to
RM736.5m in Apr ’09 (+0.4% MoM, +10.6% YoY) on expansion in both
household (+0.7% MoM, +8.5% YoY) and business loans (-0.03%
MoM, +9.2% YoY). Disbursements slowed (-6.6% MoM, -6.4% YoY)
but repayments were relatively stable (+1.3% MoM, -2.8% YoY). YTD
loans growth was +1.4% (4M2008: +3.4%), driven by household loans
(+2.2%) while business loans’ growth was anemic (+0.4%).
Forward indicators contracting. Loan applications and approvals fell
YoY: -5.4% and -18.2%. The business segment saw loan applications
and approvals down 24.2% and 35%, while the household segment
continued to see growing appetite in loan applications but flattish loan
approvals. On a MoM comparison, both indicators also showed
contraction. Loan applications fell 1.4% while approvals slipped 0.8%.
Absolute NPLs inched up. Absolute NPLs ticked-up by 0.34% MoM to
RM33.7b (Mar ‘09: -3.7% MoM). However, Apr ‘09’s absolute NPLs
were still lower than a year ago, by 14.7%. We suspect the rising NPLs
came from the business segment, especially exporters. The net NPL
ratio was unchanged at 2.24% due to the expanded loans base. Loan
loss coverage (LLC) remained adequate at 88.5% (Mar ’09: 88.3%).
Stay Underweight. The combined 1Q09 net profit of the six banking
stocks we cover was down 2.1% QoQ, and a sharper 13.1% YoY, on
lower treasury and FX income and higher loan loss provisions. We
expect sector earnings to contract 10% YoY in 2009 and reiterate our
concerns on asset and loan quality as the economy contracts over the
next two quarters. Our analysis shows a 3-6 months interval from GDP
trough to NPL peak. Banks are set to report weaker profits.
This document provides a summary of the global economic outlook and trends for retailers to consider. It discusses slowing economic growth in many leading markets in 2012. In Europe, government spending cuts and debt issues are weakening economies and confidence. In the US, uncertainty around fiscal policy is hurting markets. China is also slowing after monetary tightening. Some positives for retailers include potential margin improvements from lower commodity prices and inflation in some countries. Long term global growth prospects remain strong, especially in emerging markets.
Be cautious into 3Q. 1Q09 results of the six banking stocks we cover
were generally in line, with combined net profit down 2.1% QoQ and
13.1% YoY. However, the weak 1Q09 GDP suggests growing stress in
system loans over the coming months. We remain cautious on banks’
profits, especially from 3Q09. Underweight the sector.
1Q down a sharp 13.1% YoY. Other than AMMB’s positive surprise,
results were generally in-line. The combined net profit of our banking
universe was flattish QoQ but fell a sharp 13.1% YoY on lower treasury
and FX income and higher loan loss provisions. Net interest income
expanded, but the weak equity market continued to affect brokerage
income, which contracted for the 5th to 6th consecutive quarter.
Some signs of stress. Domestic loans continued growing at most
banks. QoQ loan growth at the major banks (Maybank, CIMB Bank and
Public Bank) outpaced system growth. Some loan segments, however,
have begun showing stress. Domestic NPL saw upticks in the
consumer (mortgage, autos) and working capital segments. Net NPL
ratios continued to trend down due to the expanded loans base.
Earnings to contract. There were no major revisions in our individual
earnings forecasts except for AMMB (FY09: +16%, FY10: +7%). Our
combined net profit forecast was upgraded by a marginal 0.1% for 2009
and 0.7% for 2010. We expect sector earnings to contract 9.9% in
2009, before recovering to 6.8% growth in 2010 (previously -10.1%,
+6.1% respectively). This excludes further impairment in the value of
long-term investments, merger costs and other one-offs.
Asset quality concerns. 1Q09 GDP (-6.2% YoY, -7.7% QoQ) should
be the weakest, suggesting that the worst may be over. However, we
expect economic recovery to be slow, with real GDP to return to the
3Q08 high only in 4Q10. There is a 3-6 month interval from GDP trough
to NPL peak. Hence, banks are set to report weaker profits on rising
NPLs and higher credit charges from 3Q09.
Mainly Sells. Against regional peers, the larger Malaysian banks are
pricey. The current liquidity driven market has pushed valuations up but
prospects for a strong economic recovery stay hazy. Sell into strength.
The document provides a disclaimer and forward-looking statements regarding a presentation by Banco Santander Totta, S.A. and Banco Santander, S.A. It cautions that the presentation contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially. It also states that the information in the presentation should be read in conjunction with other public disclosures and does not constitute an offer to buy or sell securities.
The document provides a summary and analysis of economic conditions in Thailand and other regions. It discusses:
1) Continued concerns about the eurozone debt crisis fueling demand for safe-haven currencies like the US dollar and depressing risk assets.
2) While US money supply growth looks better than the EU or Japan, high unemployment will likely lead the Fed to resume quantitative easing in mid-2012.
3) Local authorities in Thailand face challenges from losses at the Fiscal Debt Fund and risks of bond yield curve steepening given planned large bond issuances.
4) The analysis predicts the Bank of Thailand will cut its policy rate again in January and forecasts Thailand's economy could experience a V-shaped
CSC reported strong financial results for the second quarter of fiscal year 2005, with revenue increasing 9.6% year-over-year to $3.93 billion. Both the global commercial and U.S. federal government segments contributed to revenue growth. CSC won $3.9 billion in new contracts during the quarter. The company expects continued demand in the federal government for IT modernization and infrastructure projects.
The document summarizes the performance of Global Banking and Markets in the first half of 2008. Key points include:
- Global Banking and Markets contributed 26% of the group's pre-tax profits despite challenging market conditions.
- Strength in emerging markets like Asia Pacific and Latin America helped offset losses elsewhere.
- Writedowns were taken on subprime, credit, and leveraged loan exposures totaling $3.9 billion.
- Two of the group's structured investment vehicles, Cullinan and Asscher, had their assets transferred or sold into three securities investment conduits to provide more stable funding.
2008 Fourth Quarter Real Estate Commentaryalghanim
The global real estate market suffered in 2008 due to the financial crisis and economic downturn. U.S. REITs rebounded in the 4th quarter of 2008 and may lead a recovery in 2009 if the U.S. economy rebounds. Credit markets remain largely frozen, which is impacting commercial mortgage backed securities and new lending. Defensive investment strategies focused on liquidity and balance sheet strength are positioned to perform best in 2009 until economic and market conditions stabilize further. Opportunities may arise in undervalued REITs and direct commercial real estate if accessed with a long/short hedge fund strategy.
Raport Global Dynamism Index 2012: fundamenty rozwoju biznesu.Grant Thornton
Polska wykorzystała szansę na ponadprzeciętny rozwój w ostatnich latach. Tym niemniej trwały, dynamiczny wzrost polskich firm, a w konsekwencji gospodarki, wymaga zmian czyniących środowisko gospodarcze bardziej przyjaznym rozwojowi przedsiębiorstw. Bez nich wzrost utrzyma się jedynie w średnim okresie czasu. To wnioski płynące z najnowszego raportu Global Dynamism Index 2012: fundamenty rozwoju biznesu.
Grant Thornton - Second Quarter 2012 IFRS NewsGrant Thornton
The document provides a summary of the more significant developments in International Financial Reporting Standards (IFRS) in the second quarter of 2012. It discusses the IASB's revised work plan and projected targets for 2012, including delays to new standards on revenue recognition and leases. It also covers issues related to the current economic environment that may affect financial reporting, such as going concern assessments and impairment considerations. Additionally, it summarizes recent publications and guidance from Grant Thornton International on topics like IFRS for SMEs questions and answers, comment letters, and example financial statements for first-time IFRS adopters.
Grant Tornton UK - Football transfer tracker 2012Grant Thornton
January 2011 saw exceptional levels of investment in the playing staff of Premier League teams. Expenditure during the January 2012 transfer window returned to more frugal levels following the spike of last year. In this edition of our football transfer tracker we consider whether the UEFA’s Financial Fair Play Regulations may have contributed to the drop in transfer activity and the consequences for the transfer market as a whole.
Sustainable growth in the food and drink manufacturing industryGrant Thornton
This report summarizes the findings of a study commissioned by the Food and Drink Federation on sustainable growth in the UK's food and drink manufacturing industry. The study utilized surveys and interviews with industry participants to understand growth drivers and barriers. Key findings include:
1) Exporting and innovation were identified as major drivers of growth, while regulatory burdens and input costs pose significant barriers.
2) The industry has competitive advantages in areas like health and wellness products but can improve in sustainability and skills development.
3) Close partnership with government will be important to address barriers and optimize conditions for the industry to achieve its goal of 20% growth by 2020 in a sustainable manner.
Grant Thornton - Facing an uncertain future: Government intervention threaten...Grant Thornton
The document discusses increasing government intervention in the global mining sector that is adding complexity and uncertainty. It poses threats such as higher taxes, restrictive regulations, and potential nationalization of mining assets. This raises risks for commodity prices, valuations, and investment. Government interventions are motivated by desires for more revenue and responding to public pressures around environmental issues. The key areas discussed are taxation increases, nationalization/indigenization policies, and stricter environmental regulations being implemented around the world.
1) The document discusses Bank of America's enterprise risk management strategies and capabilities. It highlights how the bank manages various types of risk, including credit, market, and operational risk across its consumer and commercial businesses.
2) Key strengths that help the bank manage risk include its breadth of client access, industry insights, and integrated risk management structure.
3) The bank has improved its risk profile by rebalancing its commercial credit portfolio and enhancing risk monitoring tools.
BANKING Mar 09 Statistics Some ResilienceBoyboy cute
Positive signs. Loan disbursements, repayments, applications and
approvals rebounded with strong double-digit MoM growth, flattish-tolow-
teens YoY growth, and in absolute term, were back to pre-Aug/Sep
’08 levels. Absolute NPLs continued to inch lower, mainly from the
working capital segment. Nonetheless, it is early to tell whether these
are sustainable as global fundamentals remain weak.
Strong loan disbursements and repayments. Banking loans (net of
repayments) grew to RM733.9m in Mar ’09 (+0.6% MoM, +10.9% YoY)
on expansion in both household (+0.4% MoM, +8.8% YoY) and
business loans (+0.9% MoM, +9.5% YoY). The pace of disbursements
and repayments was strong (disbursements: +27.4% MoM, +9% YoY;
repayments: +15.7% MoM, +4.8% YoY), mainly for working capital.
YTD loans growth was +1% (household: +1.5%, business: +0.5%).
Forward indicators bounced MoM but still flattish YoY. Loan
applications and approvals also rebounded strongly: +24.3% MoM and
+35.3% MoM respectively. On a YoY comparison, loan applications
were up 4.7%, driven by household loan applications (+21.5%), mainly
for home purchases, which off-set lower applications from businesses
(-11%). Overall loan approvals were rather flattish YoY, with approvals
up for household loans (+12.6%) but down for business loans (-13%).
Absolute NPLs contracted further. Absolute gross NPLs continued
to inch lower, at a slightly higher pace of -3.7% MoM to RM33.6b (Feb
‘09: -0.04% MoM). On a 3-month comparison (see table in page 4),
the lower NPLs came mainly from the working capital segment,
reflecting perhaps resilient business strength. Meanwhile, net NPL ratio
was little changed at 2.24% (Feb ‘09: 2.23%).
Remain Underweight. YTD loans growth, if sustained, should lead to
the upper end of our 2-3% loans growth forecast for 2009. Our other
assumption is for absolute NPLs to expand by 50% YoY by end-2009,
leading to a projected 10% decline in combined net profit for 2009.
While loans quality was resilient in Mar ’09, we remain concerned over
rising NPLs – our analysis shows a 3-6 months interval from GDP
trough to NPL peak. The other main risk is a protracted economic
slowdown leading to rising unemployment and asset deflation.
The document discusses the implications of Hungary's accession to the EU on its investment management industry. It provides background on the development of Hungary's financial services and investment management industries. The investment management industry grew slowly in the 1990s and more rapidly in the late 1990s. Assets under management increased annually by 23% between 1997-2002. The EU accession will significantly impact the Hungarian investment management industry by leveling the regulatory playing field and allowing more competition from foreign investment managers and funds. This may challenge domestic investment managers.
VTB Capital "Russia Calling: London Session May-June 2011MRSK Centre
The document provides an overview of IDGC Capital's 2010 results and 2011 forecast. It highlights the company's strong growth across key financial metrics like revenue, EBITDA, and net profit between 2008-2011. Capitalization is forecast to grow at a CAGR of 64% during this period. The company has a large network across central Russia and implemented a KPI system to improve efficiency under RAB regulation. Prospects for continued growth are seen through lower depreciation and sector undervaluation relative to foreign peers.
The budget focuses on fiscal consolidation and boosting growth. It marginally increases tax deductions but also raises some taxes. Funding is enhanced for infrastructure through tax-free bonds and ECB changes. The power sector may benefit from coal duty exemptions and FSA commitments. However, the auto sector faces higher excise duties that could impact large carmakers. Key assumptions around GDP and oil prices make deficit targets optimistic. Overall policy measures only partially address issues around land, environment and state electricity boards.
The document discusses three potential paths for markets in 2013: a base case, bull case, and bear case. The base case, which has a 55-65% probability of occurring, involves a compromise deal between Democrats and Republicans to modestly mitigate the fiscal cliff and result in low single-digit returns. A bull case involves a long-term fiscal solution, while a bear case risks recession if a deal is not reached. The path taken will depend on negotiations in the lame duck session and early 2013.
Weakness ahead. Loan disbursements, applications and approvals
slowed in Apr, reflecting cautious sentiment. Loans growth was just
1.4% YTD, and 4.2% annualised. There was a slight uptick in absolute
NPLs, implying stress in some loans segments. The poor 1Q09 GDP
numbers suggest growing stress in system loans over the next few
months. We remain cautious on banks’ profits, especially from 3Q09.
1.4% YTD loans growth. Banking loans (net of repayments) grew to
RM736.5m in Apr ’09 (+0.4% MoM, +10.6% YoY) on expansion in both
household (+0.7% MoM, +8.5% YoY) and business loans (-0.03%
MoM, +9.2% YoY). Disbursements slowed (-6.6% MoM, -6.4% YoY)
but repayments were relatively stable (+1.3% MoM, -2.8% YoY). YTD
loans growth was +1.4% (4M2008: +3.4%), driven by household loans
(+2.2%) while business loans’ growth was anemic (+0.4%).
Forward indicators contracting. Loan applications and approvals fell
YoY: -5.4% and -18.2%. The business segment saw loan applications
and approvals down 24.2% and 35%, while the household segment
continued to see growing appetite in loan applications but flattish loan
approvals. On a MoM comparison, both indicators also showed
contraction. Loan applications fell 1.4% while approvals slipped 0.8%.
Absolute NPLs inched up. Absolute NPLs ticked-up by 0.34% MoM to
RM33.7b (Mar ‘09: -3.7% MoM). However, Apr ‘09’s absolute NPLs
were still lower than a year ago, by 14.7%. We suspect the rising NPLs
came from the business segment, especially exporters. The net NPL
ratio was unchanged at 2.24% due to the expanded loans base. Loan
loss coverage (LLC) remained adequate at 88.5% (Mar ’09: 88.3%).
Stay Underweight. The combined 1Q09 net profit of the six banking
stocks we cover was down 2.1% QoQ, and a sharper 13.1% YoY, on
lower treasury and FX income and higher loan loss provisions. We
expect sector earnings to contract 10% YoY in 2009 and reiterate our
concerns on asset and loan quality as the economy contracts over the
next two quarters. Our analysis shows a 3-6 months interval from GDP
trough to NPL peak. Banks are set to report weaker profits.
This document provides a summary of the global economic outlook and trends for retailers to consider. It discusses slowing economic growth in many leading markets in 2012. In Europe, government spending cuts and debt issues are weakening economies and confidence. In the US, uncertainty around fiscal policy is hurting markets. China is also slowing after monetary tightening. Some positives for retailers include potential margin improvements from lower commodity prices and inflation in some countries. Long term global growth prospects remain strong, especially in emerging markets.
Be cautious into 3Q. 1Q09 results of the six banking stocks we cover
were generally in line, with combined net profit down 2.1% QoQ and
13.1% YoY. However, the weak 1Q09 GDP suggests growing stress in
system loans over the coming months. We remain cautious on banks’
profits, especially from 3Q09. Underweight the sector.
1Q down a sharp 13.1% YoY. Other than AMMB’s positive surprise,
results were generally in-line. The combined net profit of our banking
universe was flattish QoQ but fell a sharp 13.1% YoY on lower treasury
and FX income and higher loan loss provisions. Net interest income
expanded, but the weak equity market continued to affect brokerage
income, which contracted for the 5th to 6th consecutive quarter.
Some signs of stress. Domestic loans continued growing at most
banks. QoQ loan growth at the major banks (Maybank, CIMB Bank and
Public Bank) outpaced system growth. Some loan segments, however,
have begun showing stress. Domestic NPL saw upticks in the
consumer (mortgage, autos) and working capital segments. Net NPL
ratios continued to trend down due to the expanded loans base.
Earnings to contract. There were no major revisions in our individual
earnings forecasts except for AMMB (FY09: +16%, FY10: +7%). Our
combined net profit forecast was upgraded by a marginal 0.1% for 2009
and 0.7% for 2010. We expect sector earnings to contract 9.9% in
2009, before recovering to 6.8% growth in 2010 (previously -10.1%,
+6.1% respectively). This excludes further impairment in the value of
long-term investments, merger costs and other one-offs.
Asset quality concerns. 1Q09 GDP (-6.2% YoY, -7.7% QoQ) should
be the weakest, suggesting that the worst may be over. However, we
expect economic recovery to be slow, with real GDP to return to the
3Q08 high only in 4Q10. There is a 3-6 month interval from GDP trough
to NPL peak. Hence, banks are set to report weaker profits on rising
NPLs and higher credit charges from 3Q09.
Mainly Sells. Against regional peers, the larger Malaysian banks are
pricey. The current liquidity driven market has pushed valuations up but
prospects for a strong economic recovery stay hazy. Sell into strength.
The document provides a disclaimer and forward-looking statements regarding a presentation by Banco Santander Totta, S.A. and Banco Santander, S.A. It cautions that the presentation contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially. It also states that the information in the presentation should be read in conjunction with other public disclosures and does not constitute an offer to buy or sell securities.
The document provides a summary and analysis of economic conditions in Thailand and other regions. It discusses:
1) Continued concerns about the eurozone debt crisis fueling demand for safe-haven currencies like the US dollar and depressing risk assets.
2) While US money supply growth looks better than the EU or Japan, high unemployment will likely lead the Fed to resume quantitative easing in mid-2012.
3) Local authorities in Thailand face challenges from losses at the Fiscal Debt Fund and risks of bond yield curve steepening given planned large bond issuances.
4) The analysis predicts the Bank of Thailand will cut its policy rate again in January and forecasts Thailand's economy could experience a V-shaped
CSC reported strong financial results for the second quarter of fiscal year 2005, with revenue increasing 9.6% year-over-year to $3.93 billion. Both the global commercial and U.S. federal government segments contributed to revenue growth. CSC won $3.9 billion in new contracts during the quarter. The company expects continued demand in the federal government for IT modernization and infrastructure projects.
The document summarizes the performance of Global Banking and Markets in the first half of 2008. Key points include:
- Global Banking and Markets contributed 26% of the group's pre-tax profits despite challenging market conditions.
- Strength in emerging markets like Asia Pacific and Latin America helped offset losses elsewhere.
- Writedowns were taken on subprime, credit, and leveraged loan exposures totaling $3.9 billion.
- Two of the group's structured investment vehicles, Cullinan and Asscher, had their assets transferred or sold into three securities investment conduits to provide more stable funding.
2008 Fourth Quarter Real Estate Commentaryalghanim
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The document discusses increasing government intervention in the global mining sector that is adding complexity and uncertainty. It poses threats such as higher taxes, restrictive regulations, and potential nationalization of mining assets. This raises risks for commodity prices, valuations, and investment. Government interventions are motivated by desires for more revenue and responding to public pressures around environmental issues. The key areas discussed are taxation increases, nationalization/indigenization policies, and stricter environmental regulations being implemented around the world.
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a CET1 ratio of 10% in 2013
Capitalising on the market-leading position of its retail
banks and associated business lines
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2. Key themes for 2012
The restructuring landscape in 2012 is likely to
be characterised by low interest rates, a lack of
liquidity and low asset prices as well as banks’
continuing efforts to minimise losses.
In line with this, respondents to Grant Thornton’s
‘Restructuring Outlook for 2012’ survey expect that
underperforming businesses in the UK, their funders
and other stakeholders will continue to collaborate,
wherever possible, to save businesses through
financial and operational restructurings.
However, respondents also highlighted that
some business models will need a radical overhaul
to survive in a low growth economy and that a
restriction in credit availability, which many expect
to worsen in 2012, may make this particularly
Contents
difficult. Also of concern to respondents is
‘restructuring fatigue’ of management teams and 2. Key themes for 2012
stakeholders, especially in relation to companies that
have been through numerous restructurings already. 3. Summary of survey findings
Predictably, a large number of respondents
4. Macro-economic threats and the outlook
caveated their responses in case of a disorderly
for the UK economy
Greek default or a breakup of the Eurozone. One
respondent said memorably: 6. Resilience of UK business in 2012
8. Restructuring strategies employed
“If the Euro collapses then all bets 12. Refinancings, forbearance and
are off” administration levels
Restructuring/recovery banker
15. About ‘Restructuring Outlook for 2012’
2 The Restructuring Outlook for 2012
3. Summary of survey findings
Perhaps unsurprisingly, 72% of respondents think that the Eurozone
sovereign debt crisis poses the greatest macro-economic threat to the
UK economy in 2012, followed by stagnating UK growth and the
Government’s austerity measures.
The UK economy Trading administrations/pre-packs
63% of respondents expect a deterioration of In line with the subdued outlook for the UK
economic conditions in 2012. More positively, economy, 51% of respondents expect trading
only 7% expect a significant deterioration. administrations to increase in 2012. This is, of
course, from a relatively low level. The same
Defaults and sectors most at risk percentage of respondents expect pre-pack
75% of respondents expect default rates to go up administrations to increase.
in 2012, with retail, hotels/leisure, print, property/
construction, haulage/logistics and travel/tourism
rated as particularly vulnerable.
Factors leading to distress
When asked to rate the contributory factors for
distress in 2011, the vast majority of respondents “There is now a greater realisation by funders that
highlighted declining revenues and rising costs. ‘extend and pretend’ strategies which are reliant on
These issues were commonly compounded by poor
low interest rates and low inflation come with a ‘sell-
management decisions and poor financial control.
by-date’ and that fixes to the capital structure, and
in many cases, far reaching operational changes are
Restructuring solutions
When asked which restructuring strategies
necessary to create sustainable value.”
Mark Byers, Partner, Global Head of Restructuring
were successfully implemented in 2011, most
highlighted better cash flow management,
cost cutting programmes and staff reductions.
Respondents said that whilst cash control will
still be key in 2012, the focus will shift towards
operational restructurings.
Availability of refinancing funds
The majority, 60%, of respondents expect the
availability of funds for refinancing in 2012 to be
broadly the same as in the previous year. Of note
is that 56% of respondents expect an increase in
the availability of distressed asset funds whilst just
under 50% expect a decrease in leveraged finance.
The Restructuring Outlook for 2012 3
4. Macro-economic threats
and the outlook for the
UK economy
Macro-economic threats to the UK economy
Perhaps unsurprisingly, 72% of respondents think
that the Eurozone sovereign debt crisis poses
the greatest macro-economic threat to the UK
economy in 2012, followed by stagnating UK
growth and the Government’s austerity measures.
Fig 1: Looking to the next 12 months, how do you rate the impact
of the following macro trends?
% of respondents rating impact as highest (8 to 10 out of range 1 to 10)
80
72%
70
59%
60
49%
50 45%
“Addressing the uncertainty in the Eurozone has to form
40 36% a fundamental part of any longer term solution within
30 the UK economy”
20 15% 15% Restructuring/recovery banker
10
0
The weighting given to the Eurozone sovereign
Prolonged stagnant/slow growth in the UK
UK Corporate tax burden
UK austerity measures
Eurozone sovereign debt crisis
More limited debt finance
UK double-dip
Currency issues
debt crisis undoubtedly reflects the importance
of the Eurozone export market to UK businesses,
but it is also a measure of the growing sense that
Europe’s politicians are failing to control the crisis.
A number of respondents voiced grave concerns
over the Eurozone sovereign debt crisis and
predict, if it is not contained, a crisis of confidence
across Europe and globally with much greater
ramifications than the contraction of credit
following the collapse of Lehman Brothers. A
similar number, however, were more bullish about
the Euro and expect the currency to survive.
4 The Restructuring Outlook for 2012
5. “I’ve been predicting more corporate failures for the
last two years and it’s not happened. So although
everyone is saying 2012 will be even harder I’m actually
expecting a similar year to the last two”
Restructuring/recovery banker
Outlook for the UK economy in 2012
“I expect economic conditions to be challenging In line with UK economic projections, 63% of
in 2012. This combined with lenders seeking to respondents expect a deterioration of economic
conditions in 2012. More positively, only 7% expect
deleverage their own balance sheets and having limited
a significant deterioration. 28% expect economic
appetite for new money will mean many restructurings conditions to stay the same, whilst 2% expect them
will be structured to deliver a short term exit” to improve somewhat. No one surveyed expects the
Restructuring/recovery banker economy to improve significantly.
UK’s negative GDP growth in Quarter 4 2011
adds weight to respondents’ pessimistic outlook
for 2012. However, respondents point to the low
interest rate environment in the UK as a key life
line for underperforming businesses in 2012. Also,
some expect the Olympics to provide a much
needed boost to the London economy and, in
particular, to the leisure and retail sectors.
Fig 2: Looking to the next 12 months, do you expect UK economic
conditions to
2%
7%
28%
63%
Deteriorate significantly Deteriorate somewhat
Stay the same Improve somewhat
Improve significantly* (nobody chose this option)
The Restructuring Outlook for 2012 5
6. Resilience of UK business
in 2012
Default levels
The vast majority of respondents, 75%, expect default levels to increase in 2012, as
conditions for many UK businesses deteriorate, with public sector cuts continuing to
filter through and private sector growth remaining sluggish.
Fig 3: Looking at the next 12 months, how do you expect default levels to develop?
1%
24%
Increase
Stay the same
Decline
75% “As defaults increase opportunities
will undoubtedly arise for
distressed investors, however I
would also point out that many
UK companies are now looking
to transactions as a route to
performance improvements. But
in a climate of much more limited
finance, companies will need
to closely interrogate valuation
fundamentals and the promise of
synergies to return meaningful
benefits to shareholders”
Geoff Davies, Partner, Head of Corporate Finance
6 The Restructuring Outlook for 2012
7. Fig 4: Looking at the next 12 months, how would you rate the resilience of the following sectors of
the UK economy?
Higher resiliance Average resiliance Lower resiliance
Retail
Hotels/ Pubs/
Leisure
Printing
Property/
Construction
Haulage/ Logistics
Travel/ Tourism
Automotive
Financial Services
Healthcare (private)
Professional Practices
Manufacturing
Infrastructure
Agribusiness/ Food/
Beverage
Aerospace/ Defence
Technology/ Media
/ Telecoms
Pharma/ Biotech/
Medical Devices
Energy/ Utility
0 20 40 60 80 100
Sectors most at risk in 2012 Generally speaking, UK companies
Unsurprisingly, sectors vulnerable to in global markets can look to harness
low consumer confidence and lower new export markets, source lower cost
credit availability, are considered to production and look to outsourcing
have the lowest resilience in 2012. More to mitigate against the risks of a UK
than 90% of respondents expect Retail and European downturn, whilst those
and Hotels/Leisure and Pubs to be reliant on the domestic and European
particularly vulnerable. Print, Property/ market will continue to find trading
Construction, Haulage/Logistics and conditions difficult in 2012.
Travel/Tourism and are the next most
vulnerable sectors. Marginally more
respondents expect the Automotive
sector to have lower than average
resilience, so this is another sector to
watch in 2012.
Respondents rated only two sectors,
Energy/Utility (71% of respondents)
and Pharma/Biotech/Medical devices
(53% of respondents) as more resilient
than the average.
The Restructuring Outlook for 2012 7
8. Restructuring strategies
employed
Contributory factors leading to
underperformance of UK businesses
When asked to rate the contributory factors for
distress in 2011, the vast majority of respondents
highlighted declining revenues and rising costs.
These issues were commonly compounded by poor
management decisions and poor financial control.
Fig 5: Looking at the distressed cases you worked on in the last 12 months, what were the main contributory factors leading to distress?
100
80
60
40
20
0
Decline in revenues
Poor management decisions
Poor financial control
Rising costs
Inappropriate business model
More limited/ expensive
debt finance
Tax/TTP debt burden
Increased competition
Public sector cuts
Fraud
Product substitution/
obsolesence
Export market volatility
External Regulation
8 The Restructuring Outlook for 2012
9. Financial and operational
Fig 6: In the last 12 months, what type of restructuring strategies have been employed in the cases you
restructurings favoured in 2011 worked on?
Respondents reported that the majority
All of them The majority The minority None
of distressed businesses they worked
with in 2011 carried out financial Financial restructuring
and operational restructures. Whilst Operational restructuring /Turnaround
operational restructurings have taken
Administration
place in many cases, these were mostly
Pre-pack administration
around cost cutting and staff reductions.
Banks agreed to rollover debt with CVA
changes to terms in the majority of Exit via alternative funder
cases. Administrations and pre-pack Rollover with changes to terms
administrations were seen as the last Forebearance
resort and were employed as such. CVAs
0 20 40 60 80 100
and exits via alternative lenders were
employed in a minority of cases.
“With downside risks for the global
economy depressing company
valuations, banks will continue to
favour consensual restructuring
“Lack of liquidity in the market will dissuade lenders solutions over forced disposals or
from exiting by administration where avoidable.” insolvency. However, a significant
Restructuring/recovery banker number of underperforming
businesses have gone through a
number of restructurings already.
For these businesses the questions
must surely be: Is the underlying
business still viable? If so, how can
restructuring fatigue be avoided?”
David Dunckley, Partner, Head of Mid Market Restructuring
The Restructuring Outlook for 2012 9
10. Restructuring strategies to deal
Fig 7: Looking back at the last 12 months, did your borrowers successfully implement the following?
with underperformance
All of them The majority The minority None
When asked which restructuring
strategies were successfully Better cash flow management
implemented in 2011, most highlight
Cost cutting programmes
better cash flow management,
Reduction in staff cost
cost cutting programmes and staff
Realignment of strategy/ business model
reductions. Respondents said that
whilst cash control will still be key in Better focus on sales and marketing
2012, the attention is shifting towards a Management team restructure
more focused assessment of operational Divestments of non-core assets
deficiencies, their impact on the Diversification strategy
bottom line and the capital expenditure
Outsourcing strategy
necessary to deal with them.
0 20 40 60 80 100 120
Interestingly, whilst 80%
of respondents point to poor
management decisions as a key
contributory factor leading to
distress in 2011, management team
restructures were only implemented
in the minority of cases. Working
with management teams of distressed
“Over the last few years, especially
companies to drive behavioural and
more structural changes will need to for businesses that were not in
be a key area of focus for 2012. actual payment default, the lenders’
restructuring approach was often to
‘extend and pretend’ and fixes to the
“More operational restructuring required as capital structure were often avoided.
follow up to earlier financial restructurings that Many of these companies will need to
haven’t worked. More pain to be taken as poor substantially increase their trading activity
businesses face up to years of excess that they to avoid future covenant breaches. In a
can no longer carry.” stagnating economy, this may well require
Restructuring/recovery banker a fundamental rethink of their business
model to drive profitability and growth”
Stephen Rigby, Partner, Head of Performance Improvement
10 The Restructuring Outlook for 2012
11. Sectors under threat
Retail
“Over the last few years many retailers have
failed to adapt their business model to the
changes in the way that consumers shop.
Hotels
Where operational restructuring did occur, it “In 2012 hotel performance will
was mostly reactive and focused on aligning follow a similar trend to that
the cost base to perceived recessionary in 2011, with London hotels
trading levels, in the expectation that the outperforming regional hotels
market would soon return to 2007 levels. For and with budget, limited service
many retailers, this may prove a fatal error and luxury hotels outperforming
as the current and future retail environment the 4-star sector. The 4-star
requires a significantly reduced physical hotel business model will remain
footprint. So, the right-sizing of retailer’s under significant pressure, with
store footprint will need to be a key area of limited service hotels successfully
focus in 2012, alongside continuous efforts to targeting corporate business. This
optimise their supply chain, merchandising will be compounded by the fact
and retail operations.” that many hotels in this segment
Grant McRobert, Restructuring Partner, Retail have been under invested for some
time. As a result the 4-star sector
is a key area to watch in 2012 as
are hotel operators with significant
debt servicing commitments.”
Adrian Richards, Restructuring Partner, Hotels
Real Estate
“The last six months have seen a contraction
in bank funding to the real estate sector as
well as a decline in the number of potential
purchasers. With fewer exit options available
in distressed property situations, lenders are
looking to increase, rather than just realise,
the value of their security. Lenders are
therefore increasingly aligning the interests of
their advisors, seeking to reward on the basis
of the uplift in value achieved upon exit.”
Jeremy Toone, Partner, Real Estate Advisory
The Restructuring Outlook for 2012 11
12. Refinancings, forbearance and
administration levels
Availability of funds to refinance existing bank debt
The majority, 60%, of respondents expect the availability of funds for
refinancing in 2012 to be broadly the same as in the previous year. Of
note is that 56% of respondents expect an increase in the availability
of distressed asset funds whilst just under 50% expect a decrease in
leveraged finance.
The expected restriction of leveraged finance availability in the
market will be of significant concern, as will be the impact of the ‘wall of
refinancing’ on debt markets in 2012 and beyond. At present, it is unclear
how the estimated £150bn – £200bn of sub-investment grade refinancings,
which will become due over the next few years, will impact on the market.
Underperforming companies and those in sectors that are considered less
resilient will be most vulnerable to a possible credit restriction in 2012.
Fig 8: In terms of restructuring/refinancing existing bank debt, how much would you rate the
availability of the following in 2012?
Less availability than in 2011 Same as 2011 More availability than in 2011
Leveraged finance
Bi-lateral lending
“Those looking to refinance
Club deals/syndicated in 2012, whether by choice or
necessity, are facing a changed
Shareholders environment. Leveraged finance
is not as readily available and
PE finance for some, alternative sources of
finance, such as asset based lending
Debt for equity swaps with its lower capital adequacy
requirement, may well become the
ABL funding solution of choice”
David Riley, Partner, Advisory
Distressed asset funds
0 20 40 60 80 100
12 The Restructuring Outlook for 2012
13. “During the course of 2012 banks
are likely to be more mindful
of forbearance levels especially
if more severe macro-economic
scenarios develop. The impact of
lender forbearance and to which
Use of forbearance in 2012 degree forbearance has masked an
The majority of respondents, 57%, expect the use of forbearance to underlying risk to banks’ capital
remain at the same level as in 2011. A sizable number of respondents, levels will only become clearer
29%, expect banks to make more use of forbearance, whilst 15%
if these macro-economic threats
expect a decline.
play out.”
Fig 9: In 2012, do you expect bank forbearance Mark Byers, Partner, Global Head of Restructuring
strategies to be used
More than in 2011 Same level as 2011 “A large part of forbearance risk
Less than in 2011 in the UK will be attached to
residential and commercial real
estate, saying this, as the use of
15%
forbearance comes under greater
29% scrutiny by the FSA and other
regulators, it will become critical
for corporate restructuring
strategies to deliver more than
‘just time’.”
Daniel Smith, Partner, Restructuring
57%
The Restructuring Outlook for 2012 13
14. Levels of pre-pack and trading
administrations
The lack of liquidity in the market
will continue to make trading
administrations the least attractive
option for exit. However, in line
with the subdued outlook for the
UK economy, 51% of respondents
expect trading administrations to
increase in 2012. This is, of course,
from a relatively low level. The same
percentage of respondents expect pre-
pack administrations to increase.
Fig 10: Looking at the next 12 months, do you
expect the number of trading administrations to
Stay the same Increase
Decline
5%
44%
51%
Fig 11: Looking at the next 12 months, do you
expect the number of pre-pack administrations to
Stay the same Increase
Decline
3%
46%
51%
14 The Restructuring Outlook for 2012
15. About ‘Restructuring
Outlook for 2012’
This is a survey of UK restructuring/recovery
bankers, asset based lenders and restructuring
advisers including senior turnaround professionals.
It rates the prospects for UK businesses in 2012
and provides insights into the restructuring
strategies employed in the market and the
key sectors expected to be vulnerable in 2012.
Responses were collected online from 9 Jan
2012 to 20 Jan 2012. In total 183 respondents
participated, breaking down into 48 %
restructuring and recovery bankers, 27% live
side bankers, 7% asset based lenders and 18%
turnaround executives and other restructuring
advisers.
Respondents work with UK businesses of
all sizes, in terms of debt this breaks down into,
20% of respondents work with businesses owing
+£50million, 16% owing £25-50million, 36%
owing £5-25million and 28% owing £0-5million.
The Restructuring Outlook for 2012 15