ANZ quite a bit under NTA today. I'm having to sit on my hands so I don't push the buy button...….
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ANZ quite a bit under NTA today. I'm having to sit on my hands so I don't push the buy button...….
And possibly cheaper still the week after that!
Perhaps I should just go outside and mow the lawns. I've already done the housework and replaced a toilet seat and had an hour's walk.
Both ANZ and Westpac are looking very undervalued. In a vacuum I would be jumping into both of these with both feet. The only issue is evaluating them relative to the opportunity cost when everything else is similarly dropping significantly and for some things undervalue territory
Clearly - currently fear is controlling the stock exchanges, but not quite sure whether the drop of the banking industry as a whole is so surprising. Just think about the risks:
Tourism worldwide just fall of a cliff - it is now fair to assume that most of the industry is loosing now at least one full season. Many tourism operators might not have the financial headroom to survive and bite the dust. The banks who gave them money might not look that flash afterwards either.
Many highly indebted countries are currently pumping huge additional funds into some first aid of their economies. Some might be able to afford this additional debt, many will do it anyway and some will crumble, particularly considering that tax take will drop at the same time. Bankrupt companies don't pay taxes anymore. Just wondering whats happening with the banks holding large amount of bonds of the countries (some of the obvious might be e.g. Italy, Spain, Greece, Turkey) which won't make it financially.
Unemployment will rise worldwide. No need to employ waiters, maids, cleaning staff, chefs, airline staff and so on if nobody is travelling and hardly anybody going out. Unemployed people will have problems to repay their loans. Some might have enough financial headroom but most will not.
I am not saying this is the end of the world, but the value of our banks is currently dependent on a lot of things we can't really assess. While I think that ANZ is one of the stronger and less impacted banks ... only time will tell.
Pretty sure lower loan repay rates and higher unemployment will make life for ANZ and Westpac uncomfortable as well. Not sure about them holding sub prime bonds of indebted countries (but they well might - remember NZ Super fund loosing money in a Portuguese bond?).
I hold a small amount of ANZ shares, but I am not sure now is the best time to top up.
Thanks for your reply BP.
Loans to the tourism industry are certainly a potential risk. Quite a bit will depend on how much govt. support they are given to make sure the can see it through.
in terms of traditional home mortgage lending I really see this as very low risk. 35% minimum deposit for investors or 20% for most owner occupiers and 10% for a very small number with higher margins and strict criteria. Most would rather skip meals and cut other expenses than lose their house.
both ANZ and westpac are very well capitalised. ANZ having 11% of CET1 capital.
the biggest risk I see is the interest rate cut in Australia which will put pressure on margins but also most likely reduce stress on some loans.
I like ANZ divesting their non core businesses like the JV in cambodia and sticking to Aus and NZ
statutory profit for both companies was significantly negatively impacted in 2019 due to remediation costs so once we add that back in for fy20 I think things should be looking much rosier.
Look at that spread today - what the heck happened?
Market seems reasonably comfortable with the interim, despite the rather large fall in cash profit, dividend decision deferred, and provisions.
Yes, Aussies not so optimistic as the kiwis overall at the moment. ANZ seem confident they will be able to contend with whatever is thrown at them over the next few months, but then a bank would say that - confidence is everything. I guess their confidence comes also from their liquidity, and liquidity in the system. No matter how rough it is in the short-term, the whole she-bang will skid along on all the excess money until it eventually gains some traction on the other side. The dividend will be a blow to some, but certainly the right decision.
Good:
Deferred, instead of outright cutting or cancelling, interim dividend (on regulators guidance) and no extra capital will be raised at this point :). Interestingly that was based on a projected scenario far more pessimistic than the one NAB are working on! Reaffirmed strong capital position compared to some rivals.
Bad:
Took another write down due to Mike Smiths pet project in Asia from which they continue to try to untangle themselves.
I just commented on ANZ on the Bank Stocks thread
https://www.sharetrader.co.nz/showth...l=1#post811992
[QUOTE]Bad:
Took another write down due to Mike Smiths pet project in Asia from which they continue to try to untangle themselves. [QUOTE]
I wouldn't be too hard on Mike Smith. ANZ were involved in Asia long before his time. Remember Grindlays Bank in India, a subsidiary of the ES and A Bank which ANZ merged with in 1969?
[QUOTE=macduffy;812001][QUOTE]Bad:
Took another write down due to Mike Smiths pet project in Asia from which they continue to try to untangle themselves.I always liked the Asia strategy, one of thereasons I originally bought in. Unfortunately it didn't bring in as much as just lending to Assies to buy houses.Quote:
I wouldn't be too hard on Mike Smith. ANZ were involved in Asia long before his time. Remember Grindlays Bank in India, a subsidiary of the ES and A Bank which ANZ merged with in 1969?
ANZ in for a further pounding on Monday? At Friday close, the NZ listing was at $17.14, down 78c or 4.35% for the day. The AU one ended down 6.8% at close, which by my calcs should see NZ at $16.66, however, that steep decline at the end of the AU trading looked a bit ominous...
Attachment 11463
Maybe things are a bit tight. I notice they've started charging me a $5 monthly account fee as of the end of April.
It wasn't so long ago that BNZ dropped their monthly $5 charge. I wonder if that will be reintroduced?
Morningstar's revised guidance dated 30/4 for the Aussie listing is AUD$25, accumulate.
"With our longer-term forecasts largely unchanged, the changes are not material enough to move our AUD 25 FVE. We believe the bank remains undervalued, trading at a 32% discount to our fair value."
There's been quite a long running chapter of these sort of charges being refined & whacked upwards by ANZ ..
On a commercial account I remember less than $4, then $4 monthly fee - paper statements got knocked back to 6 monthly - but no change in fees
More recently, base fee got whacked up to $8.50 pm on pretence of increased free transactions - a huge increase for no extra
service rendered for some low transaction accounts ...
As I have always thought - show me a bank that is not for very long behind the eight ball .. Banks are goldmines
ANZ is no different & IMO potentially a good buy ATM for mid to longer term, and looks better of the two Aussie
banking outfits listed on NZX
I've been buying ANZ and WBC around $16 to $18. I think the easiest money to be made in the next 2 years. Pity there wont be a DRP in these low prices too. I am nowhere near as bearish as many and I think all the downside is factored in now at these prices. Who knows but I'm happy to park money here. $20 ex divvy end of year I'm picking easy
In 2009 I bought in at around $19 thinking they were well undervalued (they probably were) and now here we are 10 years later back under that level. I also have bought a few more around $16 as they will survive and eventually bounce back up as the economies pick up. Could be a few years before all the bad debt is worked through and it could be a rough couple of years for both the business and the share price.
Noob question time... Why do we see this? Is it some kind of manipulation to keep the price in a tight range and try build some support? Or am I reading too much into it?
Attachment 11488
On second thoughts, you'd have stuff all chance of manipulation with this stock on the NZX anyway I guess.
ANZ and WBC which one will you go for ?
I see the AU listing has broken down through a lot of resistance (~450k shares) at $15.50...I wonder what's going on.
Any update on deferred dividends?
Interesting to me that banks aren't finding love when the wider market is pricing a V.
trade the banks never hold... trouble is there always trouble in the banks...... Dividend? your kidding... well i think that over the NEXT 9 year these stock are very very tradeable.... note to one self if still not retired ... sell everything before the next crisis... war with china?
FED news on US bank stress tests coming over the wires and possible restrictions on dividend payments may have some influence on Aussi bank share prices going forward.
More relief payments trickling out in the news with the second round of lockdowns. Loan deferrals extended etc.
From what I read, these measures end up costing the borrower more over the life of the loan so not exactly bad news for the lenders?
Looks like ANZ will pay a dividend in today's announcement
Just curious if anyone knows, as sure as the sun rises each day, everyday at midday (when the ASX opens in Oz), trades suddenly appear in market depth, 400 shares in each parcel, one trader, and both the sell and buy sides. Eg. sell side 19.20, 19.21, 19.22 etc, all one seller with 400 shares. Likewise on the buy side 19.19, 19.18, 19.17 etc. Whats the purpose of this, I assume its a bot, but where is the profit in trying to influence the price each side? Potentially buying and selling from itself?
Just the normal opening auction. As far as I know - all stock exchanges are doing this for opening and closing - helps to avoid funny spikes at the start and end of trading. While bots are these days involved as well - this tradition ways predates the invention of trading bots (and does not need them).
https://rivkin.com.au/resources/unde...sing-auctions/
Great, thanks. I'm just not sure with ANZ if its something just related to opening and closing action. Its happening with ANZ at all times of the day, but only appears once the ASX opens, and also appears on the NZX from midday. Its clear its a bot trying to drive the price up or down, I just cant get my head around what it actually achieves as I imagine it ends up gobbling up its own shares during the process. For ANZ its often the only trader trading, as all parcels are 400 shares.
Not sure - 400 ANZ shares are not an unreasonable parcel size ... not quite what most bots would trade (remember - bots don't pay a minimum fee per trade ...).
As well - selling to oneself would be blatant market manipulation and illegal. While things like that might happen from time to time, I would not assume that as the default explanation.
As well - if anybody would want to manipulate share prices - this clearly would be easier with a less liquid stock.
Is the 'happy time' returning to banking? Australia unwinds it's onerous regulation.
This always happens. Regulators come in and go heavy handed and over time the regulations get slowly erroded to a point that we are back at close to where they started. All that happens is customers have to declare more things and pay more somewhere along the line. A great day for my holdings I have to say
From the article:
"As part of a sweeping overhaul of so-called responsible lending obligations, the government will allow banks to rely on income and spending information provided by borrowers when assessing loan applications, rather than doing their own lengthy verifications, (Australian) Treasurer Josh Frydenberg said Friday."
Apart from reducing the 'double verification' paperwork by customers and banks, the underlying loans are still going to be the same. The article talks about reducing 'excessive risk aversion' by banks. But surely the opposite is true. If the banks don't spend any time evaluating the borrowers loan credentials themselves, there will be greater uncertainty from a bank perspective. So they will be more risk averse. IOW the process of taking out loans will be cheaper (cut by half as the article suggests). But less loans will be approved.
"Caught in the regulatory cross-hairs, the nation’s biggest lenders became cautious -- stifling credit to the economy even with borrowing costs at record lows."
Sounds like what happened in New Zealand with the government guaranteeing 80% of new bank loans and urging the banks to have loose purse strings. The problem is, under this arrangement, banks must still shoulder the costs of 20% of any loan that goes bad. So the take up by banks of the new Covid-19 inspired scheme in NZ was less than expected.
"Said Kyle Rodda, an analyst at IG Markets Ltd. “There’s a cost element to it -- lower compliance costs, lower regulatory costs -- but banks’ bread and butter is lending out money, and the more money you can lend out the more money you’re going to make.” "
How much money do the banks make on bad loans? Never mind. The CEOs of the big banks commenting in the article think it is a good thing. But will they follow through?
SNOOPY
Went into a branch today in a part of NZ that hadn’t seen a single case in 6 months and is at Level 1 and was asked to sign in using the app. I refused and was asked to sign in manually. I also refused and reminded them it was Level 1 so no requirement to sign in. Was told it was a bank requirement. Walked out and am considering changing banks. I have business personal and trust accounts and have had enough of all the bull**** that passes for H&S in 2020. We have saved 400 lives this year from the lockdown disrupting normal flu (non Covid flu) so maybe let’s just have a lockdown every autumn and destroy the economy as the evidence shows we will hundreds of lives guaranteed!
Oh dear.. systems like this are coming and in a world where virus exists there will be more systems. Get used to it and train yourself to see it as an economic hardening of the system. Forget your life before, its not coming back any time soon. See the new world people, its been here for a while as Bill Gates pointed out and we did not take notice. Notice now and get used to a new world, new systems because be thank full this is not as bad as it can get.
"Try opening accounts for your businesses, trusts and personal banking"
yes its a nightmare but the westpac saga was appalling and after the GFC we made the mistake or trading the banks in auss.... live and learn and always do your own research... turned out you needed hire investigators... just buy buffet? yep that should have been the game and ive course quantum.
whatch out with Y H.. may not be as secure as you need , same with bloom B.
The group ANZ result is down a lot but it is all explained by provisions and an increase in costs, which is bound to be covid.
I have no clue but I keep thinking heaps of these provisions wont be required as things eventually return to a post-covid normal. Of course there will be some actual writeoffs, but imo not to the scale of whats being set aside. Only time will tell but for now I am hanging on to my underwater Aussie banks
I'm still above water on ANZ as I topped up quite a bit in April at $16 and $17. Lucky NZ and Aus have handled COVID well. As you say, there are still likely to be business defaults on the way. Low interest rates won't help for the foreseeable future but the strong housing market protects them from any real carnage - long may that last. They likely to be under pressure for a while. If interest rates ever rise again, banks are likely to be one of the shares that benefit, but that might be a lifetime away.
Does anyone get any update for the upcoming dividends? I got the email from Shareies but nothing from ASB. Feel strange.
ANZ is my largest holding in my portfolio. Post COVID I viewed it as a good recovery stock. I feel underweight in Heartland.
I wonder if I should transfer funds from one to the other.
My thoughts-
HGH potential dividend 11 cents fully imputed =11/0.72 = 15.28 cps on $2.05 =.7.45%
ANZ dividends prior to COVID seemed to be a steady $1.60 + .18 imputation = 178cps on $31.14 = 5.72%
HGH shares seem to have a steady upward trend with increased company profits each year.
ANZ share price seems over the years to be anything but consistent.
Would anyone favour one over the other at this time?
Thank you.
I am holding both ... and roughly similar weighting in my portfolio. Comparing them - forward PE based on analyst estimates is quite similar (13.2 for ANZ and 13.4 for HGH). Forecasted earnings growth for ANZ is however basically zilch (ignoring the 2020 dip) - i.e. this is as good as it gets, while analysts think that HGH has quite some earnings growth potential (forward CAGR of 7).
Do I think the analysts are right? Well, sometimes they are, sometimes they are not, however - I would think that HGH has long term more headroom for further growth than ANZ has. ANZ SP is anyway behaving quite cyclical ... and obviously ... further growth is much harder to achieve for a large entity than for a smaller one.
Still - I think there is space for both in the portfolio, but if the time comes to sell, than I probably will start with ANZ :):
I picked up both in April last year, HGH is 33% of my portfolio while ANZ is 20%. My % gain has been pretty close on both, recently HGH has pulled ahead.
I like both and I'm happy with my position.
I hold HGH, WBC and ANZ, in that order of weighting. Overall, probably accounts for about 9% of my portfolio. As BP mentions, ANZ particularly seems quite cyclical, which is where increased return can be achieved - although obviously over the last year they have all had great buying opportunities. They were 3 of the few stocks I didn't bail on last year. I could have done better if I had, but made good top ups along the way. Happy to hold all 3.
Bob50, I hold both ANZ and Heartland as well. But I don't see them as directly comparable. From an investment perspective I divide, the finance market into 'Tier 1' , 'Tier 2' and 'Tier 3' players which have different risk/return profiles. ANZ is definitely 'Tier 1', Heartland 'Tier 2' and something like Harmoney 'Tier 3'.
I compare finance sector investments within Tier groups, not across Tier groups. IMO ANZ is a far better banking operator than Westpac for instance (I have held both over many years, and have accounts with both). In Tier 2 I hold both Heartland and Turners (which I keep having to remind people is primarily a finance company with an automotive adjunct). I think the key thing in Tier 2 is to find your niche and be good at executing within it. Heartland and Turners are in different niches, although both are in the automotive loan market and that seems a good space to be. I see a bit more risk going forwards in the Reverse Equity Loan market with the Australian government emerging as a competitor. It is always hard to compete against the government! Nevertheless it is not a full overlap on product offering yet, so Heartland still has an innovative role to play. The transformation to a 'Fintech' for Heartland is both a risk and an opportunity. I back Heartland management to be agile enough to succeed. Turners are probably the more boring investment of the two. But they execute well and sometimes, particularly in finance, boring is a good thing.
Tier 3 investment in financing I leave to others. I get nervous enough with the Tier 2 stuff, and I don't feel I need to accept the risks on what are generally high interest loans to borrowers of dubious credit history.
SNOOPY
Appqrently All banking services across australia down. Bitcoin continues on as normal
you so onto the failings of the mainstream financial system CC
what I dont quite get is that Akamai, the Content Delivery Network that failed is only supposed to be caching , so if it goes down shouldnt the original source deliver instead? Sure it might be a lot slower, but it still should work - I would have thought.
If networks were down then crypto compromised as well?
This might be the relevant reminder in above context:
Attachment 12632
I have held both ANZ and Heartland since 2012. According to Sharesight the return from HGH/HBL has been considerably higher.
If the Australian government ever dismantles the four pillars policy, things could become a bit more dynamic for the mature Australian banks.
Gentlemen, can we just stay on-topic please. Much appreciated! :)
A bloodletting of aussie banks today, following on from the US.
Deleted duplicate.
For those interested....(I am)
https://announcements.nzx.com/detail/375867
By my rough calcs...
~ 1.82% of the shares will be bought back.
Not really sure we will even see share price appreciation of that magnitude.
Equates to about 53c per current share...existing count.
Sigh. I've posted enough on my preferences over share buybacks previously.
WBC to come next...
could be just the starter..
Awesome use of money. I'd rather this than lose franking credits constantly. Definitely just the start I'd say
CCP getting local cities ready for possible EV default in 30 days... will impact AUS bank stocks for a short time just before results and div time.
Any picks on divvy coming? Special Divvy? I'm hoping up to 75c divvy
Not far off:
72.0 cps proposed Final
https://www.nzx.com/announcements/381694
http://nzx-prod-s7fsd7f98s.s3-websit...694/357878.pdf
Looks like a decent result. Australia operations is holding steady while New Zealand home loans picked up decently over the last financial year.
Lets see what happens when we enter a higher interest period.
Decent Div but ANZ made me sell half my holding to secure lending with ANZ for my property development :'(
Banks SP's up in the US. ANZ looks like a good BUY here.
Whole new year and US 10 year should be on a tear .. expect bank stocks to be in the game this year.
Yields on the US 10 year should be out of the blocks as some big players arnt buying at the rate of the last 2 years.
Looking a break out here to the up side.. just breaking back above 30 handle... could start a run back to 32 and above in the next 12 to 24 months.
Im sure you all loaded up back under 28..
My last purchase was at $19.83 late 2020.......
"19.83"
hope it was a big buy...
Not big enough!
Aus banks should benefit from low jobs but results were before OMI hit.
The Kanda's are kicking it!
They are just a bunch of hard ass's amd nothing seems to keep them down.
The big banks are AUSSI owned but they all work to the whip of Mr Or and NZ statue Law.
Almost impossible to know what going on at the RBNZ.
https://www.stuff.co.nz/business/opi...e-reserve-bank
But it probably wont change the performance of the banks until T1 kicks up to 16..
Even then since they are only local its the AUS economy that will determine future SP's not NZ performance.
bits and bytes .....
DIV 72, nearly back to 2019 levels.
Holders will be starting to get excited. Interest rates only going higher from here.
Its the 1970's!!!! Well not yet anyone, soon!