Back to top

Press Releases

Zacks Industry Outlook Highlights: HDFC Bank, National Australia Bank, National Bank of Canada, Shinhan Financial Group and Westpac Banking

HDB NABZY NTIOF SHG WBK

 ZacksTrade Now

For Immediate Release

Chicago, IL – March 1, 2012 – Today, Zacks Equity Research discusses the Foreign Banks Industry, including HDFC Bank Limited ( (HDB - Analyst Report), National Australia Bank Limited (NABZY), National Bank of Canada (NTIOF), Shinhan Financial Group Co Ltd. ( (SHG) and Westpac Banking Corporation ( (WBK).

A synopsis of today’s Industry Outlook is presented below. The full article can be read at  http://www.zacks.com/stock/news/70524/Foreign+Banks+Stock+Update+%96+March+2012

 

European banks are most likely to underperform in the upcoming quarters primarily due the ongoing debt crisis in the nation and resulting capital pressure and deleveraging risk.

In early 2010, the debt crisis originating in the Greek economy shook the stability of the European Union's (EU) monetary policies. Starting as a solvency crisis in a single country, the turmoil spread over to the entire Euro-zone.

The situation did not stabilize to a great extent in 2011 despite financial assurance from the European Union leaders. Entering 2012, the European debt crisis has heightened spreading fears of a financial collapse in the continent.

Though Italy and Spain showed signs of improvement with support from the government and European Central Bank, conditions in Greece remain uncertain due to issues related to additional bailout funds.

Moreover, the high inflation will continue to force regulators to tighten their policies in the Euro-zone, making banks less flexible.

Overall, the European Union is trying hard not just to restore investor confidence but also the health of the continent’s banking system. The issue, however, remains far from being satisfied.

Emerging Markets

Coming to banks in emerging economies, the asset quality trouble is obvious. However, these are not plagued by other serious problems that many of the larger banks face in continental Europe and the United Kingdom, such as toxic securities and dilution from capital raising. Moreover, these emerging-market banks generally tend to be well capitalized, aren't as heavily exposed to property markets, and have significant and growing sources of non-interest income.

Overall, a key determinant for quick recovery will be the quality of risk analysis and risk-awareness in decision-making and incentive policies. So, we believe that accumulating larger capital buffers over the cycle and reducing pointless complexity in business will be crucial to banking performance.

Also, the primary attention of policymakers should be on determining how much longer the fiscal stimulus should continue, ensuring that it is not withdrawn before a clearer sign of economic recovery is visible.

OPPORTUNITIES

Among the non-U.S. banks, we recommend HDFC Bank Limited ( (HDB - Analyst Report), National Australia Bank Limited (NABZY), National Bank of Canada (NTIOF), Shinhan Financial Group Co Ltd. ( (SHG) and Westpac Banking Corporation ( (WBK) with a Zacks #1 Rank (short-term Strong Buy rating).

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=2679.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment

Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=4581.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Follow us on Twitter:  http://twitter.com/zacksresearch

Join us on Facebook:  http://www.facebook.com/ZacksInvestmentResearch

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com

http://www.zacks.com

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
PLANAR SYST… PLNR 4.44 +5.21%
BITAUTO HOL… BITA 81.71 +5.12%
CTPARTNERS… CTP 16.66 +4.26%
CHINA BIOLO… CBPO 47.91 +3.30%
MALLINCKROD… MNK 72.94 +2.85%