you've been reading my mail TJ (post 7145)
Printable View
Fed Farmers say 11%of dairy farmers were under scrutiny by their banks, compared with 7%in November and 6% in August.
Banks call this Strategic Debt Management - better outcomes in helping farmer out of the industry and hopefully recover more than just foreclosing / receivership
We should be grateful to Heartland management they have essentially avoided this impending fiasco
Yes Heartland Bank management/directors certainly need congratulating on their aggressive cautious stewardship.Perhaps having a lot of skin in the game makes them more focussed?
The Australian banks have not faired so well.Luckily HBL face fewer headwinds than them,yet they are being contaminated by association.!.
Over the past year ANZ sp is down 37%, BOQ down 24.43%,CBA down 23.2%,NAB down 31% and WBC down 32,7%
Growing roe, eps and dividends will eventually see a rising sp for HBL.In the meantime the ratios look very solid and modest to me.
Just had a look on ANZ securities charts and yes indeed HBL has been a real out-performer against the backdrop of a severe general correction in banking stocks. Only down 15% from $1.33 to $1.13 over the last 12 months, mitigated further by good fully imputed dividends. Good result considering how poorly many of the other Australian and international banks have shocked their shareholders. No mining exposure has been a real blessing for HBL shareholders. That said until fears of a global recession ease and until there's a genuine bounce in commodity prices that ease asset quality concerns, I expect the banking sector to remain under pressure, (HBL probably continue to outperform on a relative basis). Its been a very tough start to 2016 for many stocks with many tigers, cats and dogs very busy licking their wounds.
I still see it as a correlation with the Australian Banks,because of lower valuation multiples being applied to the banking sector at present.
"Punters" may have "greater risk aversion " but Heartland Bank's sound financials ,means " investors" can take advantage of "punters" folly.!!! lol.
Huh? I don't think so. From a shareholder perspective, Heartland is a lot more exposed to agriculture & mining than the Aussie headquarted big banks.
See table below.
Loan Category ANZ Loan Book FY2015 (gross) ANZ Loan Book FY2015 (%ge) WBC Loan Book FY2015 (gross) WBC Loan Book FY2015 (%ge) HBL Loan Book FY2015 (gross) HBL Loan Book FY2015 (%ge) Agriculture, Forestry, Fishing and Mining $39,610m 4.7% $22,671m 2.9% $576m 17.8% Business and Property Services $51,000m 6.1% $74,793m 9.7% $396m 12.2% Construction $7,609m 0.9% $7,682m 1.0% Entertainment, Leisure and Tourism $11,797m 1.4% $8,416m 1.1% Finance and insurance $230,710m 27.5% $95,694m 12.4% $377m 11.6% Government and Local Authority $52,524 6.2% $75,936m 9.9% Manufacturing $34,432m 4.1% $18,501m 2.4% $94m 2.9% Personal lending $330,925m 39.5% $419,764m 54.5% $1,397m 43.1% Electricity, Gas and Water Supplies $9,795m 1.2% $7,445m 1.0% Retail & Wholesale trade $38,528m 4.6% $22,774m 3.0% $276m 8.5% Transport and storage $14,783m 1.8% $13,895m 1.8% $20m 0.6% Other $16,455m 2.0% $2,358m 0.3% $102m 3.2% Total $838,248m 100% $769,929m 100% $3,240m 100%
SNOOPY
Be even better if they actually do an acquisition rather than just talk about it regularly for the last 18 months. I guess you could argue they're better positioned now that sector PE's have compressed but OTOH one could argue they've compressed for a reason and with slower economic times an acquisition of say MTF while potentially less expensive is also potentially riskier. (e.g. I'd imagine some of the 430 Dick Smith employees could face serious challenges ahead meeting their loan payments).
Ouch Snoopy...your beagle nose has detected something interesting there. I guess HBL have only just over $200m dairy loans so about 7% of loan book but still much higher on a relative basis than ANZ !
Also as you noted recently, HBL have been less forthcoming with appropriate doubtful debt provisioning than UDC. Must be the was it 21% ? of ANZ assets in Asia that has spooked the market then ?