None so queer as folk! But things are looking up.
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Hi This is my first post but am I missing something - wasn't the license granted 17/12/12
Just to clarify -on behalf of that rogue poster-, for those who came in late: the reserve bank's own rules required three years of prior accounts before an entity is granted a banking licence. My deduction from that was that Heartland in its current form would have to wait three years before a banking licence from the point in time it took over PGW finance. I don't know why the reserve bank did not follow their own rules, and decided to grant a banking licence a little more than a year from the PGW finance takeover. My critics have never offered an explanation as to why either. Mind you since the banking licence has been granted, I would argue the whole issue is now moot anyway. I still stand by my original prediction of not receiving a banking licence for three years given the information I had available to me at the time of making the prediction.
Also I mentioned that I believed Heartland was risky, and I still believe that. That is not the same thing as saying Heratland is on the way to inevitable trouble.
SNOOPY
Snoopy - you sure sniff some strange stuff at times?
finally! over the 75/76 barrier. Now 77. Mouse will be able to breakeven soon. Hopefully be 80s by end of this week or next week. Unfortunately not able to buy more as it is already a big chunk of my small portfolio.
Likely they will be given a 4c dividend for this year based on their earnings, I would estimate (2c now, 2c in Dec). That's basically the same as having money in the bank and earning interest, or actually a little better because its fully imputed and a slightly better than most rates the banks offer.
As such, my estimation of the real price value now for these guys sits at 95c-$1. If they get growth, which is looking likely, there is considerable upside to that value in the medium term. With a 90c NTA, I see no reason why the Heartlands price is below this value at least. However I know why - people still a bit scared to invest in a finance company, especially one with a chequered past that still has a BBB- rating.
Although interestingly Heartlands TDs are at 4.25% for 6 months or 4.45% for a year! This is higher than their dividend (though less after tax).... I wonder if this is telling? Is it better to have money in the bank or own the bank?
I think you are forgetting the Heartland hasn't hit $1 yet.
4c/77c = 5.2% net yeild (7.2% gross)
Much higher than the interest rate being offered. Plus 17% growth to get to NTA. For shareholders on capital account, that will be the equivalent to a 32% interest rate if the share price gets to 90c by the end of 12 months (capital growth of 17% grossed up and div of 7%).
Oh yes, you are right CJ, I was putting the cart before the horse! Good numbers!
http://www.thebreakfastclub.org.nz/
mentioned on another thread
May 28th ..... roll up to the an inspiring sermon from the man himself ..... probably more hysteria than at a Billy Graham gathering of old unless they restrict who is allowed to go
What a day it could be .... HNZ hits a buck and Jeff preaches to the converted
sincere apologies for the above post .... jeff will probably inspire the young wannabe bankers that morning
I am not sure that I have explained the above point clearly.
Risk in this context is a probability assessment of a possible outcome. There is both good risk, where the company has a result far in excess of analyst expectations and bad risk where the result is far worse. In my assessment HNZ possesses both of these kind of risks. I mentioned in a previous post that HNZ was a real investment and one of the few shares on the NZx where significant gains were possible. However such gains were never certain even if management does everything right that they can control.
I am consistently on record as saying that I woudl invest in HNZ if the capital position was more secure. Going after seasonal farm finance instead of financing the land itself might be a good strategy, but it also requires a higher capital ratio in the long term. In my assessment following what seems to be a sensible strategy will ultimately require more capital. That means a discounted share placement or rights issue. In my judgement that will be the best time to enter HNZ to balance the upside risks against the downside risks. The further the share price rises in the interim, the worse the entry point for long term investors.
The half year report does not contain the information needed to judge how HNZ is going long term. So I will reserve all judgements until the full year report comes out (as I have said before). If other people want to gamble on the outcome before then, well good luck to them. I will be staying out, no matter what happens to the share price until that fulll year information is out
SNOOPY
Now that is something;if anything, they may return surplus capital.!!!!!!!!!
All through this thread a number of posters have said HNZ will be raising capital.WRONG.
You really are picking up the correct information by talking to the right people.
Great research,and thank you for sharing it with us.
Percy, you wrote that at 7.15am today. What on earth are you doing out of bed at that time? It could have serious effects on your health. I, at 9.40am, have only just finished breakfast! And am not really awake.How on earth can you even THINK at that time in the morning?
Tomorrow morning I will be on the road to Geraldine and Timaru schools at 6.30am .The cat loves the alarm going off at 5 or 5.30 am early breakfast goes down a treat.Have my shower the night before.Usually try to see what the Dow has done and check out Cavotec's price on Sweedish exchange ,before I hit the road.Must be careful not to post on sharetrader,as being a slow typist,I run out of time.
ps.I dream of shares.!!!
Can't agree more with you on that one Belgie......
Attachment 4383
HNZ director Graham Russell Kennedy keep selling HNZ shares remind me of years ago one of Rakon major shareholder Peter ??? damping RAK shares at about $1.6, Rakon shares now trade at 22c. not feel good.
Looks to me as though Graham Kennedy is acting in the best interests of two long serving CSB director's trusts[Thomson trustand Church trust]
Being directors of CSB [which merged to form HNZ]they most probably were overweighted in HNZ.
I think you are still 100% wrong.So you understand what is going on. I will try to explain the facts of life to you.Think RBD.With them closing and/or selling Pizza Hut stores they did not need capital from shareholders to expand KFC etc.With unprofitable/low profit stores gone the earnings from KFC continued.So even with less turnover nett profit increased.ROE increased as did divies.
HNZ are focusing on profitable lending.Increasing ROE.Better for shareholders.
Another example of management's careful use of capital is EBO ,who have returned capital [special divie],when they don't need it,and have come to the market when they have required capital for an acqusition.EBO market cap has gone from 2.5mil to 468mil.I expect HNZ to be a great performer too.!!!
A Question. HNZ finished Friday at .75c,yet today it finished up 2c at yes .75c wow so I'm having some good gains without actually realising it,no wonder the shareprice is lagging XRO and DIL,my gosh.
seriously though,does the morning session constitute a price period and the afternoon session another complete period or what?
HNZ sh price seems to be mimicking the company - slow and steady. All I want for Christmas is for HNZ to go up 1cent every one or two weeks :)
Forgot to ask how is the Kitchen ??.. Hope you are keeping Mr's Kizame at bay.. :-))
INTERIM DIVIDEND
The directors of Heartland have resolved to pay an interim dividend of 2.0 cents per share on 5 April
2013 to shareholders on the company’s register as at 5.00pm on 20 March 2013. This dividend will be
fully imputed. (from a Heartland statement).
So trading tomorrow is with the 2 cent dividend. On the 21st, without. We can expect therefore a drop of 2 cents, or so, on the share price on the 21st.
No, it went ex yesterday, so reflected the 2 cent divi in the price. Tomorrow is the record date, which has allowed for deals traded up until Friday to be settled and recorded on the Register
Not unusual when its in an uptrend. (hope youre proud of me Hoop)
It looks as if there will be great uncertainty about Banks, not just John Banks, but money banks. We have Cyprus in trouble and Australia with problems about exporting another mountain to China. Does China want the mountain? If Gold yes, but the other stuff like coal and iron ore, we don't know.
Heartland Bank seems to have sufficient capital. But things do look difficult.
This is the problem. You place your cash in the bank, say BNZ. Another bank goes broke and you lose 10%?, 50% of your cash deposit.
Proposals do not seem to require shareholders of the bank to lose their cash!!!
What to do? Should we print more money?
Have a good week-end. (Being retired, the week-end starts Thursday, except for Percy who is thinking about money all week-end).
Having a bit of a sleep in tomorrow.Don't have to be on the road to Geraldine until 7am.Showered and getting ready for bed.
Having lovely dreams counting Heartland dollars rather than sheep.
No uncetainty with HNZ,only bank with a fresh licence,makes us "well positioned."
who is the supreme optimist with 9000 odd shares for sale at 75.00
havent seen it yet , must be good:)
What is the bet they want out at 75c mucked up the zeros.
This is a link to an English Language Cyprus newspaper. Reporting the bank problems with readers comments too. All very interesting if you want to spend the weekend worrying about cash. And bank deposits.
http://www.cyprus-mail.com/bailout/c...iness/20130321
(you may have to copy the link into Google).
hasnt fired a shot today so far. Possibly the end of financial year, reporting season, divs, record dates and general melee throughout the market is having a toll on the punters.
Generally such order won't go through at current market price, don't know why this order can be on market.
I might buy a couple of 'em and enjoy the sudden spike for the few seconds the price sky rockets!
hope this isnt you mucking about, moosie
HNZ still could be a takeover target according its lagging price, any thoughts?
pleasure to read your depth analysis
There is no reason whatsoever for Haier to sell F&P finance. Haier is Chinese, they have access to very cheap cash. To my mind the Chinese are a possibility to buy Heartland since it gives them another cheap entry to NZ, plus their funds can get a pretty safe return on a good interest rate. Heartland is an already set up business. It could easily go offshore to China. Remember, if the Chinese buy then it is for the top few billionaires, not the masses. There is no idea of corporate responsibility, they invest on a pure profit for 'me' motive.
A useful report on the Auckland Airport.
http://www.thecivilian.co.nz/aucklan...rrivals-board/
Should Heartland buy FPF it would be well received by both shareholders and institutions,as it would be a great fit.
HNZ would be rerated upward very quickly.
Great catch 22;Should HNZ find FPF goes for more than they think it is worth,then the market will most probably rerate HNZ upwards because of the price FPF sold for.
Whatever, HNZ shareholders win either way.!!!
I would be more than surprised if FPF is sold to Heartland. Simply because Chinese business has oodles of spare cash that they want to spread around the globe. So, if FPF is sold, then more than likely it will be sold to a Chinese Company. Who can fund FPF afterwards with very cheap money. Thereby getting more cash out of China.
FPF will merge or takeover HNZ.
You read it here first.
See that Haier is adding 100 new jobs to R&D, design team at FPA?
Sadly, hardly any coverage about that from the media.
Only the xenophobic reaction seems to get coverage?
I guess Haier will have the right people in place to manage the media when HNZ becomes FPF Bank?
Warehouse would have to be a potential buyer for FPF. They've just bough Noel leeming and have their own credit card. Might be issues with Farmers as they would want Warehouse running their finance scheme.
Plus what about GE - they would love to add it to their book.
I have also heard the same rumblings.
Haier bought FPA for its intellectual property and originally thought they would sell FPF. They have now realised that the finance business model is a key piece of intellectual property. They hope to take the model and replicate it in China.
So HNZ may just have to build their business the hard way, organically.
IF anybody buys FPF,it will be someone with deep pockets,not heartland.
Anyway if it's such a great asset why would anybody in their right mind sell it.
Stop speculating cos it's usually wrong imop.
What I was told at a function, after a few drinks, is that Haier is extremely pleased with their FPA investment and FPF has proven to be a huge positive surprise for them.
So now, they are looking to expand rather than sell.
And boyo, they have serious cash to do so!
We all know the world ain't fixed yet ... Banks are still under capitalised ...even hnz
John Kay sensible esteemed economist market commentator refers to Anat Admati and Martin Hellwig who reckon banks need more capital – lots more capital, not minimal provision based on a pseudoscientific calculation of risk-weighted assets.......before he concluded that the only safe bank is one with more capital than it could possibly require. Like banks of old.
And that means more an equity ratio of 14%
Prob most reckon this is load of old crock because these times a different eh but have a read ...it is short
http://www.johnkay.com/2013/04/03/8901
Even HNZ?
No.!!!!!
We have been down that blind street with Snoopy and learnt that HNZ has the best equity ratio of any listed bank in Australia and New Zealand.As we know the Australian Banks are very strong with few problem areas,so we can surmise that HNZ is in great shape.
Percy ....you didn't read it properly
All banks in the world are over leveraged, even the Aussie ones .....and just 2008 events triggered a crisis that required heaps more capital to be injected ....the whole system is not sustainable unless you believe this time it's different
As Kay says the actions/remedies of today is wishing that one can triumph of hope over experience .....and the world needs to move on from 'the socialisation of the losses of financial institutions" as he puts it
Won't affect banks today or tomorrow but one day banks and financial institutions will have heaps more capital than today
The spread of loans,the type of loans,and equity ratio of HNZ puts them in a lot stronger position than the banks refered to by John Kay.
No risk of loans to non paying nations. No concentration of risk.
HNZ capital ratios are excellent.
I think John Kay would be proud of them.
Today is dividend pay-day, yeah? Who is excited?
From my post of 27 February:
Interesting to read now that the RBNZ has this under consideration.Quote:
I still reckon that the RBNZ should tweak the weightings for higher loan to valuation lending - to act as a bit of a brake on housing speculation. No doubt the banks would protest on the grounds of impractibility, lack of systems etc. but where there's a will there's a way, even if a few more staff have to be employed to collect the information.
http://www.stuff.co.nz/business/8520...ad-of-RB-moves
Heartland is a finance company in drag. Good idea.
Without treading too heavily on UDC's turf - at least in ANZ's case!Quote:
They offer it because all banks offer it, but they don't focus on it. My own homework has shown they have a symbiotic relationship with the big banks like ASB and ANZ, where the big boys loan on the land, and Heartland work with the borrower and big bank to provide the funding for the machinery, plant and stock
Go 80, go boy go!
I hope Hoop will update us with one of his great charts and comments,but the way I see HNZ's chart is it in a very strong uptrend.
We are all "well positioned." lol.
Are you suggesting there is market manipulation? If so, I would be interest to understand how this works. I can see how someone could artificially work up the price during the day but at closing time surely there would need to be a large buyer in the market to purchase the seller's shares at the inflated price.
(sorry if I am just being naive)
Am Liking this,A nice solid uptrend. The best kind of trend,slow and steady,maybe meaning there isn't the need for the long consolidation periods.
Thanks for the explanation belgarion - that makes sense. I was looking at it for the wrong angle :).