It can run out very quickly if they start needing care. OVer $200k pa if they need 24/7 carers if you go through agencys (maybe cheaper to go direct).
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[QUOTE=belgarion;501885]No. She's worried her grand children won't be able to afford houses, schooling and healthcare in NZ
She is not alone !
Also a major concern is jobs for school leavers.
And with 8.35% interest rate at the moment can't go wrong can they. Fact sheet says 1.5% to 2.0% over major banks variable rates suggests non of this fixing nonsense either.
I see at the moment they have 3 year term deposits at 5.5% - guy from chris lee's website suggests that possibly reflects demand for equity release products. If this is case nearly 3% points margin is good stuff.
Hope they try to get the 2% premium forever. Not good for the old folks but great for shareholders and that's what's what needed eh. The old folks need the cash - Heartland give it to them ... at a cost.
Those %ages always seem small. People are always surprised that the gaps are quite big. Say HNZ borrow at 5% and lend to the old folks at 8.35% that essentially is a 67% mark up or a 40% gross margin (in retail parlance) .... something that Pumpkin Patch can't even manage some years.
Apologies for being lazy, anyone know off the top of their head when it goes ex divvy, (this divvy hound always keen on the next feed) :)
[QUOTE=percy;501887]A major concern for all First World Countries Perc..
Peasants will continue quite happily in their life style.. Earning very little, paying no Taxes :-)))
Who is going to pay the welfare for the 45% of the educated people, who are going to be replaced by Automation and Robots ???
Possibly with in the next 5 to 10 years.. :-))))
Heartland did by the loan portfolio for $61m and then paid a premium of $25m because all the guys and gals that who were running the services of the HER portfolio day to day were doing such a good job. Short of telling those guys and gals to sit at their desks and do nothing after the purchase, I am not sure it is possible to not buy the operating business in with the package.
Yes. But how could Heartland have bought only this?Quote:
The $25m goodwill represents the value HNZ attributes to the future profits from writing new HER business using branding/market position/institutional know-how that they have acquired.
Sentinal: "Ms Jeeves, cancel all my calls for the rest of the rest of the day. I especially don't want to hear from that rambunctious kiwi Heartland who keeps calling me up."
Jeeves: "Sorry boss, Heartland is on the line right now, am putting him through.
Heartland: "Hi Sentinal. Heartland here. This portfolio you are looking at quitting for $86m? Well I've decided I don't want to pay that. You can keep it. I do like your staff and all though. I am prepared to pay $25m for their services. But you can keep your loan portfolio. I realise this will leave you in the lurch, with no-one to look after your business interests. But being an Ozzie I am sure you will bounce back. Once I have your staff I will be using their inside knowledge to pinch all your business anyway. So your portfolio problems will only be short term. What do you say!"
Sentinal "Deal" (or just perhaps Sentinal would not have said that).
SNOOPY
Sir John Anderson, former boss of ANZ NZ, who as Percy keeps reminding us is NZs greatest banker, would say Heartland paid $25m too much! Post financial crisis all these second tier finance operations are only worth net asset backing, according to his accumulated wisdom.
SNOOPY
So Snoopy .....you think they paid over the top for this 'business'. ....like wasted shareholder money?
[QUOTE=janner;501902]Funny that - I remember that we discussed exactly this problem in high school (must have been in the early 70'ies). Funny thing is: We are now in 2014 and people still work 40 hour weeks (and many a bit more) and people still pay taxes. Trust me, won't be different in 5, 10 or 20 years from now. Maybe different jobs, but somebody else will ask the same question, then.
[QUOTE=BlackPeter;501936]
Hmmm yes that's easy to say, but the automation coming our way will have even larger implications than what we've seen in the past. For example, there are up to 70 million people employed around the world to drive various cars, trucks, vans, trains etc. However, driverless technology is already here and could have a massive impact on those jobs. Why pay a driver when a computer can drive a truck far more safely and efficiently right around the clock?
Definitely some big change coming, who knows how to prepare for it though :/
Chris Lee's take on Heartland, (emphasis added in bold by myself)
If they do pay a fully imputed dividend of 7 cps next year the dividend hound in me calculates that at a gross distribution of 9.72 cents, (7/.72) and based on an ex divvy price of 91.5 cents (95-3.5cps divvy due shortly), investors are looking at a gross return of 10.62% :)...with more growth in the years following given reasonable trading conditions and that ladies and gentlemen is the power of investing in a N.Z. owned bank with full imputation credits. Begs the question of why bother backing Australian owned banks doesn't it !! Did I add enough emphasis to those superior interest rate margins above :)Quote:
Heartland NZ - Heartland NZ Ltd (HNZ) has released its financial result for the Full Year ended 30 June 2014 and continues to deliver on the milestones it has set itself since origination in 2008, a performance that warrants the compliments received.
Key Financials included: (Full year to 30 June 2013 in brackets)
- Net operating income $122.2m ($107.3m)
- Operating expenses $64.7m ($70.3m)
- Impairment expense and revaluation $7.1m ($27.6m)
- Net profit before tax $50.8m ($9.4m)
- Net profit after tax $36.0m ($6.9m)
Note: NPAT for 2013 included a one-off pre-tax expense of $24.3m incurred as a result of the change in strategy with respect to the impaired non-core property assets. When adjusted for this one-off charge NPAT for the 2014 year was up $11.6m or 48% on the previous year.
HNZ’s balance sheet now exceeds $3 billion, up almost $500 million largely as a result of the purchase of the Home Equity Release business during the past year. The good news is that HNZ forecasts higher profits in the year ahead partly through lending growth but also through further reductions to the expense ratio of the bank.
Net interest margin is HNZ’s main source of profit and it represents the margin between what the bank charges its borrowers and what it pays its investors. Like NZ’s major trading banks HNZ has managed to steadily increase its net interest margin over recent years, growing the margin from 3.62% in 2012 to 4.11% in 2013 to 4.44% in 2014. The wider margins (mainstream banks are about 2.40%) reflects HNZ’s strategy of targeting wider margin lending opportunities and not targeting home mortgage lending which is the mainstay of the larger banks.
HNZ shareholders, who were patient in the initial years when the bank was established, are now no doubt very happy with the dividends being received (6 cents per share plus imputation credits for 2014) and forecast by us given the likely 2015 profit and dividend policy (7 cents per share plus imputation credits). Very few investments are offering the prospect of rising income at present so it is nice to be discussing one where this outcome is likely.
HNZ enjoys very high reinvestment rates, and growth from new depositors, which in our view is a reflection of the service provided by the bank to each depositors; something that investors often tell us is missing from their relationship with the major banks.
HNZ deposit rates have not exceeded those of the major banks recently, and have not needed to given the support that they receive from depositors, however the bank is currently offering a special rate for the 3 year term (5.50%) which may be indicative of growth being experienced from the HER lending business.
In today's news http://www.nzherald.co.nz/business/n...ectid=11317538