The number of bad China bank loans tripled in just six months of 2013, but bank profits remained mainly unscathed, writes MoneyShow's Jim Jubak, also of Jubak's Picks.
China's biggest banks cleaned house in the first half of 2013, tripling the amount of bad loans written off in the period from the first half of 2012.
That kind of coming clean would be a good thing—analysts have argued that China's banks have dragged their feet on writing off loans that have gone bad and are clearly never going to be repaid—except that it has raised fears that China's banks are cleaning house now in anticipation of a new wave of bad loans to come, as a result of a slowdown in China's economic growth.
In the first six months of 2013, China's five biggest banks wrote off 22.1 billion yuan ($3.65 billion) in debt. That was up from 7.65 billion yuan in the first half of 2012.
The worry is, with growth forecast to slow to 7.6% in 2013, the lowest growth rate since 1999, China's banks are facing a surge in bad loans as a result of the credit boom that began in 2009. The five biggest banks; Industrial and Commercial Bank of China, Bank of Communications, Agricultural Bank of China, Bank of China, and the China Construction Bank, showed a 22.4 billion yuan ($3.68 billion) increase in nonperforming loans in the first half of 2013. That took the total for nonperforming loans to 350 billion yuan ($57.5 billion), or 1% of total loans, according to Bloomberg. In the first half of the year, the big five banks added 83 billion yuan ($13.6 billion) to their reserves for loan losses.
Hot Performing Companies To Buy Right Now: Standard Financial Corp.(STND)
Standard Financial Corp. operates as the bank holding company for Standard Bank that provides financial services to individuals, families, and businesses in the United States. Its deposit products include savings, money market, commercial and regular checking, demand and NOW, and individual retirement accounts, as well as certificates of deposit. The company?s loan portfolio comprises commercial real estate, one-to four-family residential mortgage, commercial business, construction, and consumer loans; and home equity loans and lines of credit. It operates 10 branches located in the Pennsylvania counties of Allegheny, Westmoreland, and Bedford; and Allegany County, Maryland. Standard Financial Corp. was founded in 1913 and is headquartered in Monroeville, Pennsylvania.
Hot Performing Companies To Buy Right Now: Aehr Test Systems(AEHR)
Aehr Test Systems designs, engineers, and manufactures test and burn-in equipment for use in the semiconductor industry. The company primarily offers the advanced burn-in and test systems for performing tests during burn-in on logic and memory packaged ICs; the FOX full wafer contact parallel test and burn-in systems for making contact with pads of a wafer simultaneously to enable full wafer parallel test and burn-in; the MAX burn-in systems for burn-in and functionally testing of devices, such as digital signal processors, microprocessors, microcontrollers, and systems-on-a-chip; WaferPak cartridges for use in testing wafers in FOX systems; the DiePak carriers, a reusable, temporary package that enables IC manufacturers to perform final test and burn-in of bare die; and test fixtures, which hold the devices undergoing test or burn-in and electrically connect the devices under test to the system electronics. It also offers customer service and support programs, including s ystem installation, system repair, applications engineering support, spare parts inventories, customer training, and documentation. The company markets and sells its products through a network of distributors and sales representatives to semiconductor manufacturers, semiconductor contract assemblers, electronics manufacturers, and burn-in and test service companies. It has operations in the United States, Asia, and Europe. The company was founded in 1977 and is headquartered in Fremont, California.
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Medtech Global Limited engages in the development of healthcare technologies in New Zealand and Australia. It offers Medtech32, a clinical management solution utilized in primary healthcare applications; Medtech Evolution, an enterprise health management system used for medical practices, hospitals, and managed service and corporate health service providers; ManageMyHealth, a clinical and health portal that enables the individuals to manage their healthcare needs; MD Analyze, which creates clinical registries for surgeons and other specialist consultants; Linktech, a data mining and aggregation tool that allows population-based health analysis; and Medtech Clinical Audit Tool, a clinical audit system, which analyzes patient data. The company also provides tools for the management of chronic diseases, such as cardiovascular disease and diabetes; Specialty Registries; and Clinical Knowledge Management that allows clinicians to customize data collection. In addition, it offer s solutions for depression and geriatric health; prototypes and software solutions for the management of mental health, including Talking Therapy modules for the primary mental health sector and mental health referral pathways; and a solution that provides an electronic record of the sports person?s medical history and injury management. Further, the company offers data services comprising data conversion, data extract/splits/merge, and data repair; digitization services, which converts medical records into an electronic format; medical billing services, such as medical claims processing, billing, and collections and coding; medical transcription services to clinics, hospitals, physician practices, outpatient clinics, rehabilitation facilities, long term care facilities, and other health related organizations; and healthcare consultancy and training services. The company was founded in 1980 and is based in Auckland, New Zealand. Medtech Global Limited is a subsidiary of Cer eus Holdings Ltd.
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Stamford Land Corporation Ltd, an investment holding company, owns and operates a portfolio of luxury hotels in Australia, Singapore, and New Zealand. It operates hotels and resorts under the Stamford Grand North Ryde, Sir Stamford Circular Quay, Stamford Plaza Sydney Airport, Stamford Grand Adelaide, Stamford Plaza Adelaide, Stamford Plaza Melbourne, Stamford Plaza Brisbane, and Stamford Plaza Auckland names. It also engages in the investment, construction, development, and trading of residential apartments, and retail and commercial buildings. In addition, the company is involved in providing travel agency services; importing, exporting, and dealing in wall coverings, interior decorations, and furnishing products; and offering management and consultancy services. Stamford Land Corporation Ltd is based in Singapore.
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Hot Performing Companies To Buy Right Now: Red Hat Inc.(RHT)
Red Hat, Inc. provides open source software solutions to enterprises worldwide. It also offers enterprise-ready open source operating system platforms. The company provides Red Hat Enterprise Linux, an operating system designed for enterprise computing; JBoss Enterprise Middleware that offers a suite of products for developing, deploying, integrating, and managing distributed, composite, and Web-based applications and services; and Red Hat Enterprise Virtualization for Servers, including Red Hat Enterprise Virtualization Hypervisor, a hypervisor based on KVM technology that converts the Red Hat Enterprise Linux kernel into a virtualization platform; and Red Hat Enterprise Virtualization Manager, a server virtualization management system, which provide capabilities for host and guest operating systems, such as availability, live migration, power manager, storage manager, and system scheduler. It also offers other Red Hat enterprise technologies, which comprise Red Hat MRG t hat integrates open and scalable messaging; Red Hat Developer, which provides integrated development environments and support for application developers; and Red Hat Directory Server that centralizes application settings, user profiles, group data, policies, and access control information into a network-based registry. In addition, the company offers Red Hat systems management solutions, such as RHN, RHN Satellite, Red Hat Customer Portal, and JBoss ON; and infrastructure enterprise technologies, including software development tools, clustering of systems and services, and directory services. Further, it provides consulting, training, and support services. The company sells its enterprise technologies through subscriptions. It has strategic alliances with Advanced Micro Devices, Inc.; and Intel Corporation. The company was formerly known as Red Hat Software, Inc. and changed its name to Red Hat, Inc. in June 1999. Red Hat, Inc. was founded in 1993 and is headquartered in Ral eigh, North Carolina.
Advisors' Opinion:- [By Anders Bylund]
Red Hat (NYSE: RHT ) is growing up, and quickly. The Linux vendor passed the billion-dollar annual revenue milestone last year and is expected to grow another 15% in 2013.
- [By Lee Jackson]
Red Hat Inc. (NYSE: RHT) provides open source software solutions primarily to enterprise customers worldwide. With 15.4% earnings growth reported in its fiscal first quarter, sales are booming as its Jboss middleware business drives revenue. The consensus price target for this fast growing company is $58.
Hot Performing Companies To Buy Right Now: Redstone Resources Ltd(RDS.AX)
Redstone Resources Limited, together with its subsidiaries, engages in the acquisition, exploration, and evaluation of mineral properties in Australia and South America. It primarily explores for copper, gold, nickel, phosphorous, potassium, phosphate, and iron ores. The company holds an exploration portfolio of various properties covering an area of approximately 2,200 square kilometers in the West Musgraves region of Western Australia. It also holds interests in the Aneba potassium project, the Apui phosphate project, the Pontal iron ore project, and the Trombetas potassium project in the Amazon region of Brazil. The company was founded in 1999 and is East Perth, Australia.
Hot Performing Companies To Buy Right Now: Theratechnologies Com Npv (TH.TO)
Theratechnologies Inc., a specialty pharmaceutical company, engages in the discovery and development of therapeutic peptide products with a focus on growth-hormone releasing factor (GRF) peptides. Its primary products include EGRIFTA (tesamorelin for injection), an approved therapy for the reduction of excess abdominal fat in HIV-infected patients with lipodystrophy, which is marketed in the United States, Latin America, Africa, the Middle East, Europe, Russia, South Korea, Taiwan, and Thailand. The company was founded in 1993 and is headquartered in Montr茅al, Canada.
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