It’s been some time since my last post and I have been exploring a few themes which I’ll pick up in more detailed individual posts. Namely,

1. Japanese Railway companies
2. Elevator & escalator companies
3. Flavour & fragrance companies
4. Family controlled public companies

There’s a rhyme and reason for investing in these sectors based on either valuations, competitive advantages and/or economic moats. More to come ….

Here’s a table and graph of the past several years of commodity revenues at various US bank holding companies. Here are my takeaways….

• The overall market size has not dramatically changed over the years notwithstanding the media attention on waning commodity revenues at banks;
• The balance sheet utilization for physical inventory has shrunk considerably;
• JP Morgan’s commodity revenues have been on a steady downtrend; Citi on a steady uptrend; GS consistent other than a shocker in 2012 and BoA is a flat out surprise (did they include their lending portfolio?);
• It would be interesting to benchmark these figures against headcount and VaR.

It turns out that US bank holding companies (“BHC”) are required to file Form FR Y-9C with the Federal Reserve. The information collected is used by the regulators to assess and monitor the financial condition of holding company organizations, which may include parent, bank, and nonbank entities. It is primarily an analytical tool used to monitor financial institutions between on-site inspections. The following link is to a list of the largest US bank holding companies. Follow each bank’s link and select the form FR Y-9C to see the data for yourself.

Federal Reserve Form FR Y-9C

There is commodity level  data for the US BHCs in this form. More specifically, it has the following data for some active commodity banks as of December 31, 2015. All data in thousands US$

JP Morgan claim to have sold their physical business yet retain a $4.6 billion exposure to physical commodities held in inventory. Perhaps their putative exit of physical commodities was only the transportation/movement of them?