Maybe not today as only 19,000 for sale at 86cents and 240,593 wanted at 85cents.
Perhaps tomorrow?
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The problem with this comparison is that the amount of lending a bank can do is related to their tier one capital of which shareholders equity is one component. In the case of Heartland they only have shareholders equity (be it subscribed or retained earnings). ANZ and WBC have other sources of tier 1 capital such as bank issued bonds with long maturity dates locked in.
If you compared 'Return on tier 1 capital' you will probably find that ANZ and WBC do not compare as favourably with Heartland as a bare 'ROE' comparison might suggest.
SNOOPY
That why roe bad metric for banks .....leverage clouds the issue
But bank execs love it when their huge bonuses tied to roe .....just go out and borrow more and do some risky lending and hey presto roe shoots up ....and bonuses as well
The six and a half year jail sentence handed down to Bridgecorp's Robert Roest, may help to focus the attention of a great deal of people who work in the financial services sector in New Zealand.
He still doesn't even acknowledge he did anything wrong and tried to deflect the responsibility onto investors, can you believe it !!
Does this grossly reckless attitude mean he will still be eligible for parole after serving a third of his sentence ?
It should be 20 years in my view.
Good common sense and a realistic expectation that should be realised unless we get another major exogenous shock to the banking system in which case small banks like this are unfortunatly quite vulnerable. I'm sorry to say I forsee a moderate chance of a major international financial shock in the years ahead, which measured against your expected returns translates to this investment being only modestly attractive in my opinion...and that's leaving all my finance company baggage out of it. Reserve bank oversight adds another level of checks and balances but i'm well and truly over relying on regulatory oversight to protect my investments.
Just look at how "useful" the Trustees and auditors were with the finance company collapses and how toothless the Securities Commission turned out to be. Standard and Poors are very risk averse after their appalling fiasco with the AAA rating on CDO's and I predict they will be incredibly slow to re-rate this company to BBB where it really needs to be to get what I consider to be genuine bank status in the eyes of the international credit rating agencies.
I hope for everyone's sake we don't have a GFC MK2, not that I'm totally convinced we're out of the first one yet. Just wanted to add a bit of dissenting opinion for the sake of another point of view.
My view in summary, HNZ seems fairly priced for the expected returns and risks involved.
Those of us familiar with HNZ's lending book see Heartland "well positioned" to ride out any "banking shock".HNZ are not heavily into household mortgage loans.Most loans are to the productive sector,motor vechicle finance,and rural stock and seasonal loans.
HNZ's loans are mainly of a short term,which adds to their margin of safety.Not reliant on wholesale or overseas funding is a further strength.
WARREN WHO ??..
Only Well thought out answers.. Please..