By How Much Have Foreign Bank Stocks Fallen?

A few a days ago I read an interesting post titled “50 SPX Stocks Down > 50%” in “The Big Picture” site.That article inspired this post where I analyze the performance of 43 foreign banks since the October 2007 peak.

I followed these rules for this study:
a. Take the highest intra-day high reached in October 2007 as the peak.
b. If a stock reached higher price before or after October ignore it.
c. Include bank stocks listed in the OTC market as sponsored ADRs.

I selected October 2007 because after hitting highs both the US and foreign markets started going down due to the unfolding credit crunch.Just like some of the US bank stocks, some of the foreign banks listed in the chart below are down more than 50%.

Foreign Bank Stock Returns Chart:

Please click on the above thumbnail to enlarge chart.

Table:

S.No.	Company	Ticker	Country	Change (%) since Oct-07 Peak
1	Barclays Bank	BCS	UK	-53.09%
2	HSBC Bank	HBC	UK	-20.91%
3	Royal Bank of Scotland	RBS	UK	-62.00%
4	Llyods Group plc	LYG	UK	-53.03%
5	HBOS plc	HBOOY	UK	-71.76%
6	Bank of Ireland	IRE	Ireland	-59.09%
7	Allied Irish Banks	AIB	Ireland	-51.60%
8	Deutsche Bank	DB	Germany	-37.59%
9	Commerzbank	CRZBY	Germany	-35.11%
10	UBS	UBS	Switzerland	-62.27%
11	Credit Suisse Group	CS	Switzerland	-33.63%
12	Banco Bilbao Vizcaya Argentaria	BBV	Spain	-33.32%
13	Santander Central Hispano	STD	Spain	-21.93%
14	The Netherlands	ING	Spain	-31.94%
15	Kookmin Bank	KB	South Korea	-41.56%
16	Shinhan Financial	SHG	South Korea	-38.34%
17	Woori Finance	WF	South Korea	-46.66%
18	Mitsubishi UFJ Financial	MTU	Japan	-25.61%
19	Mizuho Financial	MFG	Japan	-30.42%
20	ICICI Bank	IBN	India	-55.37%
21	HDFC Bank	HDB	India	-34.90%
22	National Bank of Greece	NBG	Greece	-37.34%
23	Bancolombia S.A.	CIB	Colombia	-14.62%
24	Banco de Chile	BCH	Chile	-17.48%
25	Banco Santander Chile	SAN	Chile	-23.75%
26	Corpbanca	BCA	Chile	-30.88%
27	Banco Bradesco	BBD	Brazil	-17.03%
28	Banco Itau	ITU	Brazil	-16.59%
29	Unibanco	UBB	Brazil	-25.39%
30	Westpac Banking	WBK	Australia	-30.66%
31	National Australia Bank	NABZY	Australia	-37.08%
32	Australia and New Zealand Group	ANZBY	Australia	-46.83%
33	Banco Macro	BMA	Argentina	-37.24%
34	BBVA Banco Frances	BFR	Argentina	-42.40%
35	BNP Paribas	BNPQY	France	-23.19%
36	Societe Generale	SCGLY	France	-46.84%
37	DBS	DBSDY	Singapore	-20.13%
38	United Overseas Bank	UOVEY	Singapore	-15.65%
39	Erste Group Bank	EBKDY	Austria	-28.21%
40	Hang Seng Bank	HSNGY	Hong Kong	-3.85%
41	Swedbank	SWDBY	Sweden	-50.53%
42	Danske Bank	DNSKY	Denmark	-36.53%
43	First Bancorp	FBP	Puerto Rico	-9.31%

Note: Please note that the data used for calculation is thought to be accurate but not guaranteed. Do your own research before making any investment decisions.

Analysis:

1. Out of the five British banks, HBOOY is the worst loser since its main business is in mortgage. Surprising to see HSBC down only about 21%.
2. The Irish economy has cooled for many months now. So both IRE and AIB are down over 50%.
3. Brazil,Singapore bank stocks have held up well.
4. France’s SCGLY was cut almost in half because of the losses made by a rogue trader.
5. Only two stocks are down in the single digit range.
6. Even South Korean and Australian banks are not immune to this global slowdown. The decoupling theory does not seem to be true anymore.

The above study has confirmed my thoughts that the British banks are worst hit among the European banks. Some of the emerging market banks seem to provide shelter for investors fleeing financials in developed markets. Overall the above list can be used as a starting point to dig into some of these beaten up stocks. Or this list can be used to track these bank stocks.

Comments

[John C. Lee:]

holy crap.

2008 Sep 02 03:39 AM

[Boubou:]

The British banks have serious dividends ( at this price level ), and also do not suffer dividend withholding tax.
Is it time to get a few shares?
Or are we waiting for armageddon?
I already messed with BCS too early, but it should come right bye and bye.

2008 Sep 02 08:06 AM

[andyn:]

with Britain weak, HSBC should go down to less than 70

2008 Sep 02 10:42 AM

[Menachem Be...:]

HSBC hit a low on Feb.11th and I doubled my position on that date at $69.50/ADR. The low on that day was $69.25/ADR. Those shares have subsequently paid dividends totaling $3.75/ADR. I do not expect the share price to return to those levels ever.
In my opinion the ADR share price will close the year at or about $120/ADR. That price may seem overly optimistic to some but the fundamentals support my analysis. I also expect new revenue streams out of Korea and China as ventures in those areas begin to show results. It is also quite possible that there will be an announcement in the second quarter of 2009 that no further provisions for write downs will need to be made as they have been fully accounted for.
Just my opinion of course and folks should do their own homework.


On Sep 02 10:42 AM andyn wrote:

> with Britain weak, HSBC should go down to less than 70

2008 Sep 02 11:13 AM

[Menachem Be...:]

This news item, just reported , is exactly the type of growth I was talking about in my last post...

www.guardian.co.uk/bus...


On Sep 02 11:13 AM Menachem Ben Yakov wrote:

> HSBC hit a low on Feb.11th and I doubled my position on that date
> at $69.50/ADR. The low on that day was $69.25/ADR. Those shares have
> subsequently paid dividends totaling $3.75/ADR. I do not expect the
> share price to return to those levels ever.
> In my opinion the ADR share price will close the year at or about
> $120/ADR. That price may seem overly optimistic to some but the fundamentals
> support my analysis. I also expect new revenue streams out of Korea
> and China as ventures in those areas begin to show results. It is
> also quite possible that there will be an announcement in the second
> quarter of 2009 that no further provisions for write downs will need
> to be made as they have been fully accounted for.
> Just my opinion of course and folks should do their own homework.
>

2008 Sep 02 02:09 PM