Monday, July 22, 2013

Japan's Election, New Casinos, TPP & JGB Debt

The recent election in Japan on July 21 gives Prime Minister Abe control of both houses in the Japanese parliament. What English language media are not talking about is what it means for new casinos in Japan, and the ability to tax them and pay off Japanese Government Bond Debt. The plan for Japanese casinos will spread across the country connected to airports as the big whale gamblers are expected to be Asian tourists, especially mainland Chinese visitors.

Overseas investors have constantly complained of poor ability of future tax payers to pay for this debt. However, none of these investors seem to be aware of the coming casinos to Japan. These will not be private and therefore not run by the yakuza, or other overseas gangsters. They will pay into the government coffers and may even reduce national tax rates over time. The most likely central Tokyo location is scheduled to be in Odaiba; already in close vicinity to many hotels, and close to Tokyo's Haneda airport. An opening date of the first Japanese Casino is on July 1st, 2015. Due to pre-planning already in place, this is a reasonable soft target.

The Trans Pacific Partnership moves will now gain traction. It will bring more trade and travel to the region, and will certainly be boosted by new casinos in Japan. More visas to Japan are about to be boosted by Chinese tourist groups. This not a surprise to anyone walking around Ginza on any given day. Any observer can now see who is paying for the luxury goods in Japan' luxury stores. It is no longer local Japanese, but Chinese tourists. They feel comfortable buying luxury brands that are never fake, and occasionally even special editions unique to Japan. This all adds more appeal to the traveling tourist from Asia. Ginza stores are the perfect excuse to spend your Japanese Casino winnings in future years.

In the coming weeks and months, more details about these new Japanese casinos will spread in the English media. The connection and financial insight coming from this election into this new trend will impact retail sales, hotel bookings, restaurant reservations and short term travel. All future P/L will change in Japan. 

At TMJ Partners, we know finance, and we try and be in the right place at the time. With our professional market insight, we let our financial clients know where to be before their rivals.

For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.

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       Mark Pink                                               Shinichi Nagasawa
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Wednesday, July 17, 2013

The Top 20 Global Banks are Increasingly Chinese, not American

Recently Fortune Magazine US released a list of the top 500 corporations. Within this list are the top 20 global banks based on revenue. Overall China claims four of them including ICBC (Industrial & Commercial Bank of China) the largest of them all, topping the global list with US$133.6BN in revenue. This makes ICBC more than twice the size of Deutsche Bank.
In fact four of the top ten banks on the list are Chinese, and only one is a Japanese bank - How the world has changed in just five years after Lehman Brothers collapsed. It is indeed a "brave new world", as James Bond 007 said in Skyfall, and I would tend to agree. Was it so long ago that Japan dominated the global-landscape of bank names with domestic firms virtually unknown in the global area? It is hard to now believe that in 1993 Dai-ichi Kangyo Bank was the largest bank in the world (ranked by assets), although few outside of Japan would have recognized the name. 
The players have indeed changed with only four of the top twenty on the list now being US firms. How can that be? Only four US banks is equal to China. Is that possible in 2013? What will the same list be like in another five years? Some financial analysts we deal with focus on financial sectors and some clients claim there is a ticking "time bomb of Chinese defaulting debt", but only time will tell. 
Others claim that Japan's bank Mitsubishi UFJ Financial Group, may fall from the list when the JGB debt explodes. Kyle Bass, a well known and vocal hedge fund managers says "this is in the cards", again time will tell. Some financial analysts we deal with are laser focused on financial sectors and know which case may be true and what may be a false skew. It is always about knowing which professionals have the best insight. At Experis Finance we know the right professionals and due to our global network we sharpen that edge every day.
Source - Fortune Magazine
From Here is the City
Fortune magazine has just released its Global 500 list of the world's largest corporations (as per 2012 revenues).
He's the top 20 banks (Global 500 ranking in brackets):
1(29). Industrial & Commercial Bank of China - $133.6bn revenues
2(41). BNP Paribas - $123.0bn
3(50). China Construction Bank - $113.3bn
4(55). JPMorgan Chase - $108.1bn
5(58). Banco Santander - $106.0bn
6(60). HSBC - $105.2bn
7(61). Societe Generale - $105.0bn
8(64). Agricultural Bank of China - $103.4bn
9(66). Bank of America - $100.0bn
10(70). Bank of China - $98.4bn
11(73). Credit Agricole - $95.1bn
12(78). Wells Fargo - $91.2bn
13(79). Citigroup - $90.7bn
14(85). Lloyds Banking Group - $86.8bn
15(116) Banco Do Brasil - $72.0bn
16(130). Deutsche Bank - $67.4bn
17(163). Mitsubishi UFJ Financial Group - $57.3bn
18(168). Banco Bradesco - $55.9bn
19(177). Barclays - $54.6bn
20(180). Landesbank Baden-Wurttemberg - $53.8bn
Source - Fortune magazine

For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.

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      Mark Pink                                             Shinichi Nagasawa

Thursday, July 11, 2013

Confirmed Signs of a Coming Convertibles Boom in 2014

Today's Bloomberg story on US convertible bond sales being up the highest since 2008, has a clear link with Japan. Since May this year both sell-side clients and hedge fund clients are starting to ask about CB views for Japan. Straight corporate CBs and private CBs seem to be high on the list of new products to come. The recent Suntory IPO as well as others to follow with have a follow up wave of CBs. The question I am asked is, "Who knows the Japanese CB market well now?" There is no easy answer as the market is very cyclical. There has also been a lack of CB issuers to trade in recent years.

The Koizumi boom years of 2003-2006 had CB arbitrage hedge funds like Citadel and Highbridge doing well and dominating the market. Who will drive the next CB boom to come? It would make sense to see a Japanese CB boom 2014-2018. Why? this is mainly due to the new IPO pipelines in equities and a possible Olympic building boom expected after September 7, if Tokyo wins the 2020 bid. So if this CB boom does happen in the months to come who will dominate in the future? The players have changed and so has the market as well as regulations in Japan, but the volume will be big enough to justify the new revenue stream.

Unlike in the previous CB cycle 10 years ago I see more market share going to Japanese securities firms than before. The top 5 Japanese firms are going to expand both Japan & Asia trading at the same time. Equities, FX and perhaps CBs soon will be the troika of growth product P/L in 2014. All I can say is that forward thinking MDs who call me now are preparing for this already. Which firms will pull the trigger soon? and which firms will be left behind? At Experis Finance we certainly have clear insight.

*Information Bloomberg

For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.

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         Mark Pink                                                Shinichi Nagasawa

Tuesday, July 9, 2013

A New Way To Visualize Job Descriptions

TMJ Partners brings you a new social media recruiting tool - The Job Descriptographic.

Visualize "What It Takes To Be A Securities Analyst"

 Do you have what it takes?

Friday, July 5, 2013



第一回目のコラムは、「The Japanese stock market is not a cicada」、翻訳すると「日本の株式市場は蝉にあらず」とのものを書きました。アベノミクスにより日本の株式市場が、延いては日本経済がどのような重大な転換期にあるか、何をすべきであるか、を書いてみました。御興味のある方は是非こちらを御覧下さい。  


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.

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          Mark Pink                                               Shinichi Nagasawa
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Welcome to the TMJ Partners Blog

We look forward to giving you global insight to financial topics in Japan & Asia. We also look forward to passing on our Financial views from TMJ Partners from around the globe.

We will cover Hedge Fund, Private Equity & Investment Banking topics. We also hope to comment on General Finance, Private Wealth & Asset Management topics as well.

At TMJ Partners, our global team always try to create "innovative workforce solutions", and this is just one of them. Enjoy the blog and the insights you will discover.

For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.

Tokyo                                                              Tokyo
       Mark Pink                                                 Shinichi Nagasawa