Insights: Research Comments

Chinese Banks Part #1: For BEARS, Four Reasons Why Chinese Banks’ Distress Could Amplify the Global Sell-Off

In this three part series, we discuss macro risk posed to the markets by the enormous Chinese banking sector. In Part #1, we take the perspective of the ‘bears’, discussing why the sector could be the epicentre of a further global sell-off and/or additional macro uncertainty. In Part #2, we take the perspective of the ‘bulls’, providing reasons why many believe the macro risk posed by…

U.S. Banks: Revisiting “100 Bank Mergers”, 3 Years Later

In December 2012, we published a note, entitled “100 Bank Mergers”. In the original note, we predicted that, in the following 3 years, there would be approximately 100 bank deals in the U.S. mid-cap banking sector (i.e., representing ~25% of the approximately 450 publicly-traded U.S. banks). To support this prediction, we detailed five potential catalysts in 2012: 1) Deals beget deals … and deal activity had…

For MICs, Time to Exercise Caution?

We were recently asked to look at and give our opinion on mortgage investment corporations, or MICs. Given the ultra-low interest rate environment, high yielding MICs have become a popular product among retail investors. What we found behind these high yield products was concerning to us, particularly given the potential for a generalist investor to significantly underestimate the actual credit risk of certain MICs.

The Canadian Banks – The End of an Era (Globe and Mail)

On May 26th, the Globe and Mail featured our piece entitled, “The Canadian Banks – The End of an Era”. This article is based on material researched for our investor luncheons last fall by the same name. This “Special Comment” expands on the contents of the article with additional commentary for the benefit of our investors. Click to Download»

The Myths (and Realities) of U.S. Banking

Bank reporting season for the first quarter of 2011 is now essentially over. As we were summarizing this quarter’s aggregate results, we thought it would be interesting to discuss some significant myths in U.S. banking. Namely, we will discuss: Myth #1: U.S. Banks Continue to Struggle Myth #2: The U.S. Banking Business Model is Broken Myth #3: Bank Analyst Estimates are Relevant During a Credit Cycle…

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