Investment Rating - The industry investment rating is "Buy" [2] Core Insights - The report analyzes how overseas banks have managed risks, categorizing risk causes into four main types: foreign exchange risk and domestic macroeconomic pressure affecting asset quality, real estate risk and credit exposure under subprime debt, national debt burden and high leverage leading to capital and profit decline, and liquidity risk stemming from weak asset liquidity and liability runs [16][17][18] - The report highlights a shift in government risk management strategies, moving from substantial risk resolution to liquidity support, with a focus on early detection and response to risks. The primary methods for addressing credit risk in overseas banking have become "banks saving banks" and self-rescue [17][18] - The evolution of overseas banking risks has transitioned from external to internal and liquidity-driven issues, with a growing emphasis on managing interest rate risk, liquidity risk, and single customer structure risk [18] Summary by Sections Section 1: How Overseas Banks Address Credit Risk - The report reviews the historical context of overseas banking risks from 1990 to the present, identifying four main categories of risk [16] - It discusses the role of government in risk management, noting a trend towards less direct intervention and more emphasis on liquidity support [17] Section 2: Asian Financial Crisis (1998-2006) - The macroeconomic background of the Asian financial crisis is outlined, detailing how the crisis spread from Thailand to other Southeast Asian nations [20] - The case of the Long-Term Credit Bank of Japan is examined, highlighting its reliance on real estate lending and the consequences of the economic bubble burst [29][30] Section 3: Subprime Crisis (2007-2009) - The report discusses the subprime crisis, focusing on the failures of Lehman Brothers and Bear Stearns, and the impact of high leverage and real estate exposure [16][17] Section 4: European Sovereign Debt Crisis (2010-2013) - The report analyzes the European sovereign debt crisis, particularly the experiences of Deutsche Bank and Dexia, emphasizing the need for improved risk management practices [18] Section 5: Post-Pandemic Interest Rate Risks - The report addresses the liquidity risks and interest rate volatility faced by banks in the aftermath of the pandemic, noting the vulnerabilities of certain banks due to weak customer structures and profit models [18]