HGH - Heartland Group Holdings

[iceman]

Yes a good result and a welcome increase in dividend.
I was surprised how much they have already lent to Harmoney, $17M. They must be doing OK,
Slightly disappointing that HER is not doing the business for us yet but hopefully the increased marketing focus in both NZ & AUS will see it pickup in the 2nd half.

Business, Rural and Household all nice and steady.

Again they deliver like they say they will. A great company and management to be invested in.


$23.5 Million... well done...

[Beagle]

At first glance this looks like a sound result...impairments at $5.1m almost as much as the whole of last year so if they can get those down in due course we could see profitability ramp up to another new level especially when HER starts to really get cranking along. Dividend increase looks good and if they follow the trend we'll see a fully imputed 4.5 cent dividend at the full year result.
Dividend yield for the hounds among us would therefore be 7.5 / 0.72 = 10.4167 cents gross or 7.55% on a $1.38 SP and growing each year. Much better than money in the bank :D

[Toasty]

Much better than money in the bank :D

As a shareholder of HNZ don't I effectively have "money in the bank"?:)

[iceman]

Better to own a bank than loan a bank isn't it ?


As a shareholder of HNZ don't I effectively have "money in the bank"?:)

[Beagle]

As a shareholder of HNZ don't I effectively have "money in the bank"?:)

Its called being on the right side of the ledger :)

[stoploss]

Better to own a bank than loan a bank isn't it ?

Never a given ...Lest we forget GFC ...

[percy]

Yes a good result and a welcome increase in dividend.
I was surprised how much they have already lent to Harmoney, $17M. They must be doing OK,
Slightly disappointing that HER is not doing the business for us yet but hopefully the increased marketing focus in both NZ & AUS will see it pickup in the 2nd half.

Business, Rural and Household all nice and steady.

Again they deliver like they say they will. A great company and management to be invested in.

A good summary Iceman.The HER is a good product.Increased marketing and opening new distribution channels will get the momentum going.
Roger.That dividend yield looks wonderful on our average cost price.!! lol.
Winner69.I am missing you already.

[Beagle]

A good summary Iceman.The HER is a good product.Increased marketing and opening new distribution channels will get the momentum going.
Roger.That dividend yield looks wonderful on our average cost price.!! lol.
Winner69.I am missing you already.

Sure does mate and we've totally verified the value of the dividend reinvestment scheme :) Mate remember the debate we had about the last dividend reinvestment at $1.015 :D
I'm missing Winner69 already too.

Wonder what the resident beagle makes of the increased provision for impairments...now 0.73% of all receiveables...compares to 0.1-0.2% for most of the major Aussie banks. I guess that's the price you pay for lending more to the consumer finance and agricultural sector...has to be some price when their net interest margin is circa double that of the Aussie banks.

[Baa_Baa]

Very good result, happy with that! Well done Heartland Bank.

[Bjauck]

Very good result, happy with that! Well done Heartland Bank.
I am happy with the result -and I would probably add to my holding in HNZ rather than make a Harmoney investment. However it looks like "the market" is somewhat underwhelmed.

[vorno]

I am happy with the result -and I would probably add to my holding in HNZ rather than make a Harmoney investment. However it looks like "the market" is somewhat underwhelmed.

It's already made its increases, except that was about a week ago!
The SP today probably means it'll remain at the stable value of ~1.37-1.40.

My guess is it'll top 1.40 in the next few months? I don't think we'll see much movement before then.

[Harvey Specter]

However it looks like "the market" is somewhat underwhelmed.


It's already made its increases, except that was about a week ago!I also think the lack of progress from HER held back the upside some were expecting from the announcement.

[Beagle]

I also think the lack of progress from HER held back the upside some were expecting from the announcement.

Yes and provisioning for bad and doubtful debts of $5.1 million was higher than I expected. Still its a great core portfolio stock and a great hold for dividend income / EPS growth and possible further upside surprises from EPS accretive acquisitions. Its also great that they held costs despite growth in the loan book, (all too often, in fact its the norm, we see companies growing expenses ahead of growing the top line).
Great hold and stock trades cum a 3 cent fully imputed dividend in 5 minutes time so to speak, (record date is 19 March, payment date 2 April), so sellers at $1.37 are really only getting $1.34 before brokerage costs.

[iceman]

Yes the impairments were quite high. But they do say that impairments in the previous year were low and current is closer to expectations. So maybe we need to factor this in as normal. $ 1.1M of it was from HER in what they call "collective provisioning". Maybe you the accountant Roger can tell me what that means ?

But on the other side of the ledger we also have over $6M of HER tax losses to be utilised in the next 12 months.

Very pleasing to see the tight control on expenses with the operating expense ratio dropping from 55% to 48%.


Yes and provisioning for bad and doubtful debts of $5.1 million was higher than I expected. Still its a great core portfolio stock and a great hold for dividend income / EPS growth and possible further upside surprises from EPS accretive acquisitions. Its also great that they held costs despite growth in the loan book, (all too often, in fact its the norm, we see companies growing expenses ahead of growing the top line).
Great hold and stock trades cum a 3 cent fully imputed dividend in 5 minutes time so to speak, (record date is 19 March, payment date 2 April), so sellers at $1.37 are really only getting $1.34 before brokerage costs.

[Beagle]

Happy to oblige mate. There's two types of provisioning with bad and doubtful receivables. Specific provisioning over loans that are expected to be bad, (like that silly woman's fashion business that went under but I think they are still trying to pursue recovery through legal channels) and a general level of provisioning against receivables as a whole, "collective provisioning" which is usually based on historical data / future predicted modelling of delinquencies.

[Snow Leopard]

Hi

I am happy enough with the result and see nothing (so far) to worry about in the figures.

Keep up the good work.

That is all.

Best Wishes
Paper Tiger

[KiwiGekko]

Strange old day today for HNZ - oh well, I topped up on close ($1.35 [$1.32 if you count the divvy]) - and I will be using the DRP offer.

[Beagle]

Mr market must have been looking for something special from the announcement. I guess just achieving what they said they would, (bang on right in the middle of the updated $23-$24m guidance) recently given contained nothing special in terms of new news so the recent strong run-up unwound a bit.

Strong indications of forward demand growth give great comfort to long term holders :)

[Baa_Baa]

Mr market must have been looking for something special from the announcement. I guess just achieving what they said they would, (bang on right in the middle of the updated $23-$24m guidance) recently given contained nothing special in terms of new news so the recent strong run-up unwound a bit.

Strong indications of forward demand growth give great comfort to long term holders :)

Just goes to show how well the market values a company that does what it says and has solid plans for what it wants to improve on. Happy holding for sure.

What was the conclusion of your analysis of the DRP? Seems ok to me but the caveat of a discount no less than 95% which if exercised seems to potentially negate the avoidance of brokers fees?

[Beagle]

Just goes to show how well the market values a company that does what it says and has solid plans for what it wants to improve on. Happy holding for sure.

What was the conclusion of your analysis of the DRP? Seems ok to me but the caveat of a discount no less than 95% which if exercised seems to potentially negate the avoidance of brokers fees?

Its a great way to build wealth for those that don't need dividend income over time. Its not so much the discount which IIRC is now down to 1%, (Percy help me out mate is 1% right ?) its just using the "magic" of compounding reinvestment over time in tandem with a steadily increasing share price. Relatively painless way to build wealth if you don't need the dividend income :) That said, the dividend hound part of me likes cash dividends so I guess you could say I'm conflicted lol

[Grimy]

Yes, 1% discount is correct.
I also have a problem with DRPs. I like the discount and no brokerage. But I also like getting the cash so I can decide if I should be topping up on something else that has caught my eye.
I good problem to have though I guess........

[percy]

Dividend Reinvestment plans do stop you having the choice of what you do with the cash.
What suit one person may not suit another.
As I was trying to build my exposure to the share market, I found the compound affect of dividend reinvestment worked well.
At present time I take dividend reinvestment,where I can ,and I am still working ,so do not need the cash.My wife takes the cash.

[Joshuatree]

You need 2nd wife to work hard and bring home some bacon!!!:p

[percy]

You need 2nd wife to work hard and bring home some bacon!!!:p

With wife,two daughters and a granddaughter, I have put off my retirement for another 35 years.!!!!
Daughters say, since wife and I started to receive super-an, they have no need to work!!! lol.

[Beagle]

I look at it this way. Suppose you're Joe average investor with say 10,000 shares. You get a dividend of $300 this time. Its not like most people would go and reinvest that dividend, (minimum brokerage being $30).
Far more likely the Mrs would pounce on it and buy that lovely dress she saw discounted from $600 to $300 and then she'd probably proudly tell you she'd done a marvellous job in saving you $300 in the sale :)
This is why not having the $300 in the bank account in the first place makes profoundly good common sense especially for couples with joint bank accounts lol

[axe]

I look at it this way. Suppose you're Joe average investor with say 10,000 shares. You get a dividend of $300 this time. Its not like most people would go and reinvest that dividend, (minimum brokerage being $30).
Far more likely the Mrs would pounce on it and buy that lovely dress she saw discounted from $600 to $300 and then she'd probably proudly tell you she'd done a marvellous job in saving you $300 in the sale :)
This is why not having the $300 in the bank account in the first place makes profoundly good common sense especially for couples with joint bank accounts lol


Being a new and small time investor the DRP is a great option for me. I have the luxury of not planning to need the cash from dividends from HNZ for the next 30 years or so (retirement fund). Should be a nice income stream by then and maybe some capital appreciation too. :)

[Snoopy]

Wonder what the resident beagle makes of the increased provision for impairments...now 0.73% of all receiveables...compares to 0.1-0.2% for most of the major Aussie banks. I guess that's the price you pay for lending more to the consumer finance and agricultural sector...has to be some price when their net interest margin is circa double that of the Aussie banks.


Still not sure what the best way to account for the bad debt provisions is from an investor perspective. A bank lending in the so called 'riskier' end of the spectrum will have a tendency for more bad debts. But with an interest margin correspondingly higher, that can more than make up for it.

Perhaps I should take all the historical bad debt provisions. Then distribute those evenly across the annual profits of each year. That would produce a different profit figure than the banks declare each year. But maybe it would be more useful from an investor perspective? Comments?

SNOOPY

[Beagle]

Still not sure what the best way to account for the bad debt provisions is from an investor perspective. A bank lending in the so called 'riskier' end of the spectrum will have a tendency for more bad debts. But with an interest margin correspondingly higher, that can more than make up for it.

Perhaps I should take all the historical bad debt provisions. Then distribute those evenly across the annual profits of each year. That would produce a different profit figure than the banks declare each year. But maybe it would be more useful from an investor perspective? Comments?

SNOOPY

One would presume they're modelling higher level's of potential delinquencies from stretched dairy farmers this year, perhaps that's the reason for the increase in provisioning ? Or could it be increased provisioning in regard to Harmoney new loans ? IIRC there was some mention in the results presentation about closely managing dairy loans. I feel for some of the young sharemilkers, bit rough when you get such wild swings in the Fonterra's pay-out's from one year to the next. I'm not sure averaging historical provisioning across multiple years would generate meaningful insights. One has to presume they're modelling provisioning based on quantifiable information from one year to the next surely ?

[Under Surveillance]

In relation to the HNZ dividend reinvestment plan, it is not necessarily a case of being in or not in. Participation can be partial. I was in 100% when the discount was 5%, and went to 50% when the discount was reduced to 1%. You can change your election online with Link Market Services up to the record date for a particular dividend, 19 March in the current instance.

[vorno]

$1.33 - what's happening?! Folks are getting an itchy finger?

[Longhaul]

I would have thought it would naturally revert closer to the 50 day MA, plus the HER business is not doing as well as expected.

I expect to see it settle around the $1.25 - $1.30 mark for the near future.

(Disc. sold out at $1.40 so it might just be wishful thinking on my part).

[Beagle]

$1.33 - what's happening?! Folks are getting an itchy finger?

Bit of profit taking, nothing untoward. I predicted a few weeks back at $1.32 gains from thereon would be harder to come by.
Stock is a good strong hold at current level. One of the major brokers has just upgraded 2016 EPS to 12 cps so attach a fair PE of say 13 to that and we should see $1.56 by year end, (more if there's another EPS accretive acquisition). Add in fully imputed divvies giving circa 8% gross yield and you can see why I think its a good core portfolio stock to own :)

[Bjauck]

I would have thought it would naturally revert closer to the 50 day MA, plus the HER business is not doing as well as expected.

I expect to see it settle around the $1.25 - $1.30 mark for the near future.

(Disc. sold out at $1.40 so it might just be wishful thinking on my part).

So Longhaul is not in it for the long haul.
I would have thought the HER is a slow burner with its business growing over years rather than months. A good fit with HNZ.
Unlike some other companies, where every announcement is expected to bring a second messiah:)

[percy]

Six of one,half dozen of the other.
Share price goes up, my capital goes up,
share price drops,I get more shares in the DRP.
Feel as though I am well positioned!!!!! LOL.

[Beagle]

Six of one,half dozen of the other.
Share price goes up, my capital goes up,
share price drops,I get more shares in the DRP.
Feel as though I am well positioned!!!!! LOL.

LOL that's a good one mate.

[iceman]

I've just watched a NZX/TV interview (8 minutes) with Jeff Greenslade on www.nzx.com
Interesting to watch for people that want to know what Heartland really is about.

[Master98]

Keep on sliding! This is brilliant. Chance to top up

Disc hold :)

sold at $1.4 just before this correction, now at a better position to find right entrance price.
oz bank average PE12.5, HNZ forecast FY2015 EPS10c, so sp could down to $1.25.

[Beagle]

At $1.30 cum the 3 cent fully imputed dividend due shortly people are really selling for a net consideration of $1.27 before brokerage costs.

It seems more than likely the company will easily achieve its 2015 official forecast profit of circa $47m after positing a strong gain of 41% in the first half to earn half that annual profit already.

So lets turn our attention to the prospects for 2016.

We know that momentum in the loan book regarding Harmoney has been very strong and other area's of lending apart from HER have also been strong.

First N.Z. capital have 2016 EPS at 11.2 cps and Craigs are at 12.0 cps.

Given that the company is not shy on issuing its full year forecast very early in any given year by the time of the ASM circa late October we'll know more but in the meantime if we lay aside personal thinking and just take the mid point of those analyst forecasts we're looking at 11.6 cps.

Now applying a reasonable multiple that the company has traded on in the past and that's well supported by its slower growing competitor's in Australia, (by my reckoning a fair and reasonable PE is 13), then 13 x 11.6 cents means that by late 2015 we should be seeing a SP of $1.51. In that time we'll also have received 4.0 - 4.5 cents final divvy so shareholders buying now at $1.30 are looking at fully imputed divvy's of about 7.5cps plus a theoretical SP gain or circa 20 cents, total shareholder return of approx. 27.5 cents on a $1.30 investment, ( 21% return). This from a business that's well capitalised with ongoing growth in future years.

Opportunity knocks for those looking to increase their portfolio allocation ?

[noodles]

At $1.30 cum the 3 cent fully imputed dividend due shortly people are really selling for a net consideration of $1.27 before brokerage costs.

It seems more than likely the company will easily achieve its 2015 official forecast profit of circa $47m after positing a strong gain of 41% in the first half to earn half that annual profit already.

So lets turn our attention to the prospects for 2016.

We know that momentum in the loan book regarding Harmoney has been very strong and other area's of lending apart from HER have also been strong.

First N.Z. capital have 2016 EPS at 11.2 cps and Craigs are at 12.0 cps.

Given that the company is not shy on issuing its full year forecast very early in any given year by the time of the ASM circa late October we'll know more but in the meantime if we lay aside personal thinking and just take the mid point of those analyst forecasts we're looking at 11.6 cps.

Now applying a reasonable multiple that the company has traded on in the past and that's well supported by its slower growing competitor's in Australia, (by my reckoning a fair and reasonable PE is 13), then 13 x 11.6 cents means that by late 2015 we should be seeing a SP of $1.51. In that time we'll also have received 4.0 - 4.5 cents final divvy so shareholders buying now at $1.30 are looking at fully imputed divvy's of about 7.5cps plus a theoretical SP gain or circa 20 cents, total shareholder return of approx. 27.5 cents on a $1.30 investment, ( 21% return). This from a business that's well capitalised with ongoing growth in future years.

Opportunity knocks for those looking to increase their portfolio allocation ?

Great post Roger. Exactly the way I think about the stock. I would add that there is upside from a eps accretive acquisition.

[RTM]

Yes....great post Roger...and I topped up yesterday at 131 based on my gut feel. Thanks for quantitating it ! Unfortunately approaching the limit of what I think it is prudent to hold !



Great post Roger. Exactly the way I think about the stock. I would add that there is upside from a eps accretive acquisition.

[theace]

When is the ex-div date?

[Joshuatree]

When is the ex-div date? !!!!????. Im surprised you don't know where to look. Go to NZX click on HNZ and scroll down to div info. Let us know the X date;)

[theace]

Brain freeze .... thanks

17/3 :)

[Beagle]

At $1.30 cum the 3 cent fully imputed dividend due shortly people are really selling for a net consideration of $1.27 before brokerage costs.

It seems more than likely the company will easily achieve its 2015 official forecast profit of circa $47m after positing a strong gain of 41% in the first half to earn half that annual profit already.

So lets turn our attention to the prospects for 2016.

We know that momentum in the loan book regarding Harmoney has been very strong and other area's of lending apart from HER have also been strong.

First N.Z. capital have 2016 EPS at 11.2 cps and Craigs are at 12.0 cps.

Given that the company is not shy on issuing its full year forecast very early in any given year by the time of the ASM circa late October we'll know more but in the meantime if we lay aside personal thinking and just take the mid point of those analyst forecasts we're looking at 11.6 cps.

Now applying a reasonable multiple that the company has traded on in the past and that's well supported by its slower growing competitor's in Australia, (by my reckoning a fair and reasonable PE is 13), then 13 x 11.6 cents means that by late 2015 we should be seeing a SP of $1.51. In that time we'll also have received 4.0 - 4.5 cents final divvy so shareholders buying now at $1.30 are looking at fully imputed divvy's of about 7.5cps plus a theoretical SP gain or circa 20 cents, total shareholder return of approx. 27.5 cents on a $1.30 investment, ( 21% return). This from a business that's well capitalised with ongoing growth in future years.

Opportunity knocks for those looking to increase their portfolio allocation ?

Hmmm...surely today's stellar performance not attributable to me. Must be something up ???

[Master98]

I am back at $1.3, but only bought back half of my previous holding, just in case continue sliding after short bounce( even after ex divvy).

[RTM]

Still buying Roger ? What % is HNZ of your portfolio.
16.52% of mine. Don't really want it to be a lot higher. And it could easily happen if the SP appreciates further.
Good problem to have tho.


Hmmm...surely today's stellar performance not attributable to me. Must be something up ???

[percy]

Still buying Roger ? What % is HNZ of your portfolio.
16.52% of mine. Don't really want it to be a lot higher. And it could easily happen if the SP appreciates further.
Good problem to have tho.

Success in the markets results in one share often throwing your balance out.!
It is what we all aim for, then we get worried we have got it too right, and have too much tied up it one share.!!!!
A successful investor told me to let my profits run ,cut my loses ,and only add to shares I have got right.!
Seems to work a treat.!!
So you start with 12.5% to 15% of your portfolio in one share.You get it right and you then have 30% of your portfolio in that share.
What would I do ? First of all I would be thankful I got it right.I would not buy any more over the 30%.I would consider selling any shares I get in DRP, if there was another company I was keen on.
35% plus I would sell 5% to 10% of the holding,but only if I was nervous/worried ,and saw a company that diversified my portfolio,otherwise sit back and enjoy the ride until you get nervous!!!!?? lol..
So if I had too much in HNZ or EBO,I would most probably look to add AIR, or SCL to my portfolio.,

[h2so4]

An unbalanced portfolio well if you are a net saver it would soon balance out. Just add some cash.

[Beagle]

Still buying Roger ? What % is HNZ of your portfolio.
16.52% of mine. Don't really want it to be a lot higher. And it could easily happen if the SP appreciates further.
Good problem to have tho.

Yep I'm bang on with you at 16% mate. I should have touched up to my maximum self imposed ceiling for any one stock of 20% before Wednesday's comment lol.

[Arbitrage]

Surely balance is the level of risk you want to expose yourself to. Or if you have an interest or deep understanding of a company this could be 100% of your portfolio. I am sure that Warren Buffetts family and friends aren't worried about their unbalanced exposure to Berkshire Hathaway. Greater risk can bring greater reward. So keep buying Heartland if you are comfortable.

[axe]

An unbalanced portfolio well if you are a net saver it would soon balance out. Just add some cash.

Well put.

I "balanced" my portfolio by cutting Snakk which was my worst performer and putting what was left and some cash into HNZ and increased my holding.

Is this called "averaging up"???? :)


I am still new(ish) to shares investing and I appreciate the advice and experiences that you wise ST heads share.

[K1W1G0LD]

Surely balance is the level of risk you want to expose yourself to. Or if you have an interest or deep understanding of a company this could be 100% of your portfolio. I am sure that Warren Buffetts family and friends aren't worried about their unbalanced exposure to Berkshire Hathaway. Greater risk can bring greater reward. So keep buying Heartland if you are comfortable.

A risky approach.................but well calculated with all the available advice and info available in this instance.
Thats what I've done , until as Percy states HNZ gives me cause to become nervous.

[Beagle]

One million shares just traded at $1.36 !! Stock still trades cum divvy so really the buyer only paid $1.33. I noticed the small Aussie banks doing well with SP gains yesterday.

[RTM]

Percy....did you sell all your shares in one go ? Unfortunately wasn't me.


One million shares just traded at $1.36 !! Stock still trades cum divvy so really the buyer only paid $1.33. I noticed the small Aussie banks doing well with SP gains yesterday.

[percy]

Percy....did you sell all your shares in one go ? Unfortunately wasn't me.

No not me.

[tim23]

Roger - they paid $1.36 not $1.33 as when they go xd they will likely lose 3c in value!

[Beagle]

Yeah that's my point Tim. They're getting 3 cents back in 5 minutes time so to speak, and yes I agree they will probably temporarily drop by 3 cents. If you take a medium term view really their net entry cost is $1.33. The buyer is probably working out the pretty compelling earnings and dividend metrics off their net entry price. In effect they're working a dividend strip here and all the evidence I've seen is that's a valid strategy that often provides short term outperformance gains :)

[tim23]

Roger - dividend stripping, that's one from way back people used BIL as a favourite to try that tactic, does work better in bull market, but often when a stock goes xd it drops by more than the value of dividend so as a short term play its risky but over say 12 months & a few days might be okay as a dividend strip.

[tim23]

PS Trademe good example where it can go wrong $3.92cd down to $3.72xd divvy as only about 7.7c!

[axe]

PS Trademe good example where it can go wrong $3.92cd down to $3.72xd divvy as only about 7.7c!

One stock in a strong uptrend. One stock at the bottom (maybe?) of a downtrend. The trend is your friend. :)

[tim23]

Axe - TME was in a nice uptrend before it went xd while HNZ is off from $1.42 anyway so hardly in an uptrend now?

[dingoNZ]

a correction is natural and healthy - not worrying in the slightest here, just an opportunity to top-up

Disc: happily holding (and buying)

[tim23]

But is it still in uptrend? I still hold

[Snow Leopard]

But is it still in uptrend? I still hold

Long term it is still going up

The downtrend that began on 5/6 -Feb could be deemed to be (just) intact.

See what next week brings :)

Best Wishes
Paper Tiger

[RTM]

A door closes;

http://www.stuff.co.nz/business/industries/67413188/ge-finance-nz-aus-business-sold-for-8b

I guess so.

At $8Bn this might have been a step to far for HNZ ?
The Home Equity Release Mortgage Businesses were bought for $87Million
A GE deal would have been huge in comparison. NZ$8.5B.
Happy with what they are doing at the moment. They are my biggest NZ holding.
Cheers
RTM

[Harvey Specter]

At $8Bn this might have been a step to far for HNZ ?That would have required an extra $800m equity??

[Beagle]

A door closes;

http://www.stuff.co.nz/business/industries/67413188/ge-finance-nz-aus-business-sold-for-8b

They only ever said they were interested in parts of it, (too big as a complete unit).

Vendors obviously wanted a clean / complete exit.

I'm happy for HNZ to continue to grow organically and / or with smaller bolt-on acquisitions and am a happy holder.

[noodles]

They only ever said they were interested in parts of it, (too big as a complete unit).

Vendors obviously a clean and complete exit.

I'm happy for HNZ to grow organically and / or with smaller bolt-on acquisitions and am a happy holder.

Not quite complete exit. They are holding on to the commercial lending business.

Their debt consolidation business is ripe for disruption from peer to peer lenders. This may well be the reason they are exiting the business. Have GE said why they are exiting?

I am happy that Heartland are not getting into this. MTF is a far better fit.

[Beagle]

Not quite complete exit. They are holding on to the commercial lending business.Their debt consolidation business is ripe for disruption from peer to peer lenders. This may well be the reason they are exiting the business. Have GE said why they are exiting?

I am happy that Heartland are not getting into this. MTF is a far better fit.

That seems to fit with their earlier stated objectives, see http://finance.yahoo.com/news/ge-plans-exit-u-retail-161320136.html
Totally agree with you about MTF but are they willing dance partners ?

[Beagle]

Maybe that consortium will try and buy Heartland next instead!

Roger said his shares are up for grabs (for a cool $6 a pop). Get Percy on board and you're looking at 60% of the company already.

:lol: Good bit of humour to end the day on, thanks mate.

[Bobdn]

They only ever said they were interested in parts of it, (too big as a complete unit).

Vendors obviously wanted a clean / complete exit.

I'm happy for HNZ to continue to grow organically and / or with smaller bolt-on acquisitions and am a happy holder.

"Bolt-on acquisitions" - couldn't agree more (and Buffett loves bolt-ons). What's the hurry? In 15 years I want HNZ to be part funding my odd (or not so odd) "winter retreats" to Thailand. Plenty of time for them to grow into another Bendigo and Adelaide sized bank.

[sb9]

Looks like ACC has sold out some in the past few days....

[Jantar]

Closed at 1.34, not bad for ex div.

[Baa_Baa]

Closed at 1.34, not bad for ex div.

For sure! Possibly the best looking chart on the NZX as well. Even if it back tested $1.18 it'd still be an awesome chart and a platform for future SP growth.

Not to mention their 4.5% on-call deposit accounts, there's a $200k+ deposit heading their way on March 31st when it matures from a %&$# awful ANZ rate!!

BAA

[Beagle]

Some big volume in the stock today...3.4 million shares changed hands. Chris Lee talking about Kiwibank as a potential suitor for HNZ. AMP, Kiwibank, Bendgo bank, Bank of Queensland, and any other bank can all bugger off as Percy and I are not interested in selling.

[IAK]

ha ha good one.
Some big volume in the stock today...3.4 million shares changed hands. Chris Lee talking about Kiwibank as a potential suitor for HNZ. AMP, Kiwibank, Bendgo bank, Bank of Queensland, and any other bank can all bugger off as Percy and I are not interested in selling.

[janner]

Some big volume in the stock today...3.4 million shares changed hands. Chris Lee talking about Kiwibank as a potential suitor for HNZ. AMP, Kiwibank, Bendgo bank, Bank of Queensland, and any other bank can all bugger off as Percy and I are not interested in selling.

HNZ is a much larger beast ( A tiger that I have been happy to ride on ) today than it was when it came out of PGC ..

Roger !!.. There is no way we smaller shareholders can stop a take over ..

If !!. and I will repeat.. " IF " .. One is coming..

Until it doe's.. I am a VERY happy holder.. Aye perc.. :-))

[percy]

HNZ is a much larger beast ( A tiger that I have been happy to ride on ) today than it was when it came out of PGC ..

Roger !!.. There is no way we smaller shareholders can stop a take over ..

If !!. and I will repeat.. " IF " .. One is coming..

Until it doe's.. I am a VERY happy holder.. Aye perc.. :-))

Aye!!!
We are happy holders.
Smug in the knowledge,we saw the Heartland potential early on.
Content to enjoy both share price growth and fully imputated dividends .
Who knows we may even see another credit upgrade anytime!
You may even feel we are .................. [you know what].!!!!! lol.

[axe]

Opened a heartland direct call account. They have been very very busy with lots of new customers. :)

PS. Service was fantastic too. Even though busy.

[janner]

Aye!!!
We are happy holders.
Smug in the knowledge,we saw the Heartland potential early on.
Content to enjoy both share price growth and fully imputated dividends .
Who knows we may even see another credit upgrade anytime!
You may even feel we are .................. [you know what].!!!!! lol.


Smug !!.. PERCY..

You should know that SMUG is a word that will always come back and bite you..

One should never feel SMUG ..

With HNZ .. I am very happy at present.. and as you say.. ( you know what ).

:-))))

Never.. Always

[percy]

Smug !!.. PERCY..

You should know that SMUG is a word that will always come back and bite you..

One should never feel SMUG ..

With HNZ .. I am very happy at present.. and as you say.. ( you know what ).

:-))))

Never.. Always

Yes so true.
One should never be smug.
As I have found out the hard way,just when I am feeling smug, the market turns round and says, "Percy you are still a mug," and gives me a wake up call!!!
But as Winner69 often points out,its different this time !!!!!! lol.

[iceman]

I don't know mate. I think we can be a little bit haughty about this one Percy. We have been well positioned for many years and are still poised :)
I have a bit of cash to invest at the moment and have been doing research on many companies on the NZX. I struggle to find a more justified investment than HNZ, even at today's SP level. If it wasn't already above 30% of my NZX portfolio I wouldn't think twice about buying more because I feel we are very well positioned with it


Yes so true.
One should never be smug.
As I have found out the hard way,just when I am feeling smug, the market turns round and says, "Percy you are still a mug," and gives me a wake up call!!!
But as Winner69 often points out,its different this time !!!!!! lol.

[percy]

I don't know mate. I think we can be a little bit haughty about this one Percy. We have been well positioned for many years and are still poised :)
I have a bit of cash to invest at the moment and have been doing research on many companies on the NZX. I struggle to find a more justified investment than HNZ, even at today's SP level. If it wasn't already above 30% of my NZX portfolio I wouldn't think twice about buying more because I feel we are very well positioned with it

Yes poised!!!!
The fundamentals are still modest,the out look is very positive,the management are now proven,and the balance sheet is very strong.So poised is the correct word,and we are indeed very well positioned!!!.
With so many astute sharetraders being shareholders,and watching the company so closely,and giving careful analysis of the company,I too am comfortable with my overweight position.Great when a company goes from being under 20% of your portfolio,to over 30%.!!!!

[winner69]

You can be smug and haughty or whatever. The only thing to worry about is they are not driving the business hard enough, they are showing signs of managing to expectations when they could do heaps better.

The only thing that can go wrong is if the world falls apart again. But Janet is doing what she has been told to do and making sure no turmoil until after the next presidential elections. So no rate increases until 2017. The world will remain happy and markets will continue to go up.

HNZ will join in the fun .......but I wish they would push themselves harder instead of just coasting along.

[iceman]

Welcome back Winner. You were missed.
I agree there is always a risk of people becoming too comfortable when things are going well. But I am not overly concerned about this at the moment with HNZ. Definitely something to watch out for though.
I do recall MAC saying exactly the same about SUM quite some time ago and in hindsight I think he was right.


You can be smug and haughty or whatever. The only thing to worry about is they are not driving the business hard enough, they are showing signs of managing to expectations when they could do heaps better.

The only thing that can go wrong is if the world falls apart again. But Janet is doing what she has been told to do and making sure no turmoil until after the next presidential elections. So no rate increases until 2017. The world will remain happy and markets will continue to go up.

HNZ will join in the fun .......but I wish they would push themselves harder instead of just coasting along.

[Beagle]

Reading through the above I'm really enjoying this great shareholder camaraderie... lets all pat ourselves on the back a lot BUT, (and I absolutely HATE pointing out the fly in the ointment but feel compelled too nonetheless), before we all get too smug when does the overhang of the shares issued for the HER acquisition come off escrow ? Isn't it April 1 ? and wasn't it about 10% of the companies shares ? and I know for a fact that they're on record as saying they want to sell so that's quite a big overhang for the market to absorb shortly especially in tandem with accident compensation corporation who seem to be selling flat-stick.

On the other hand maybe ACC are selling down so they're well positioned with cash to participate in a near term placement and maybe if there is a placement of these overhang shares that's an opportunity for one of the other "banks" to get a sizeable foothold...not that I want a takeover. Agree with Iceman that on an objective basis taking into account risks and rewards, HNZ even at the current price ex divvy are very good value relative to an otherwise fully priced market.

Disc, I wouldn't mind raising my stake a bit but would like to see the over-hang done and dusted first.

To balance this somewhat objective post out with some natural shareholder bias, which I also feel compelled to do, did I mention that we are very well positioned :D

P.S. Go the Blackcaps !!

[stones]

VERY WELL POSITIONED we are and Percy you have a lot to answer for!!

[iceman]

I think you are right about 1 April Roger and it is 43 million shares from memory. It will be interesting to see what will happen with them !


Reading through the above I'm really enjoying this great shareholder camaraderie... lets all pat ourselves on the back a lot BUT, (and I absolutely HATE pointing out the fly in the ointment but feel compelled too nonetheless), before we all get too smug when does the overhang of the shares issued for the HER acquisition come off escrow ? Isn't it April 1 ? and wasn't it about 10% of the companies shares ? and I know for a fact that they're on record as saying they want to sell so that's quite a big overhang for the market to absorb shortly especially in tandem with accident compensation corporation who seem to be selling flat-stick.

On the other hand maybe ACC are selling down so they're well positioned with cash to participate in a near term placement and maybe if there is a placement of these overhang shares that's an opportunity for one of the other "banks" to get a sizeable foothold...not that I want a takeover. Agree with Iceman that on an objective basis taking into account risks and rewards, HNZ even at the current price ex divvy are very good value relative to an otherwise fully priced market.

Disc, I wouldn't mind raising my stake a bit but would like to see the over-hang done and dusted first.

To balance this somewhat objective post out with some natural shareholder bias, which I also feel compelled to do, did I mention that we are very well positioned :D

P.S. Go the Blackcaps !!

[Beagle]

I think you are right about 1 April Roger and it is 43 million shares from memory. It will be interesting to see what will happen with them !

Maybe we should all clobber together with a "small" loan from you know who and buy them ourselves :D

[winner69]

Only been really interested in HNZ price movements since last August. It was pretty boring before that wasn't it.

So heavily overweight HNZ as well as being seriously morally and ethically compromised in egging a bank on to do well (feel a bit of a hypocrite I do) I need to keep a close eye on the charts. So the good old linear regression channels come into play

Since August last year price going up at the rate of 1.2% a week. Good. But been weak over the last 6 weeks and now time is the enemy if it stays around this price for much longer.

Needs a boost soon or else winner will start selling down ..... only like holding things that keep going up.

Chart shows what I mean

[dingoNZ]

Anyone know when we should expect the DRP price announced?

[iceman]

Tomorrow is the last trading day to determine the strike price so I would guess they will announce it either Friday or Monday.


Anyone know when we should expect the DRP price announced?

[Beagle]

Tomorrow is the last trading day to determine the strike price so I would guess they will announce it either Friday or Monday.

Excellent. More cheap shares to add to the last lot I got in the DRP @ $1.015 from the previous dividend and I suspect those allocated this time will look like a ridiculously cheap acquisition in six months time too !!

[tim23]

Winner why didn't you exit @ say $1.40?

[winner69]

Winner why didn't you exit @ say $1.40?

Many TA people would say I should have but essentially I like doing medium to long term trades rather. Than reacting to short term volatility. As long as the price is trending up (preferably strongly) I stay in. Sometimes these trades can last for years.

Suppose I am saying that the bottom channel line is my sell trigger (stop loss) and as long as it above that line all is honky dory. As said before I don't always immediately react to 'triggers' and am rather undisciplined in that respect.

With HNZ I will start to get ready to lighten up if the bottom line is hit. Hopefully not until closer to $2 plus.

Could have avoided that question of yours if I had included both top and bottom extremities in the channel (book says I should) but my methodology is to try to tighten the channel up that covers a large % of the price activity, on the assumption that at times things go wonky like the sudden rush to buy post announcement that pushed the price up to $1.40.

That's my story and I sticking to it.

[Wallace D]

Many TA people would say I should have but essentially I like doing medium to long term trades rather. Than reacting to short term volatility. As long as the price is trending up (preferably strongly) I stay in. Sometimes these trades can last for years.

Suppose I am saying that the bottom channel line is my sell trigger (stop loss) and as long as it above that line all is honky dory. As said before I don't always immediately react to 'triggers' and am rather undisciplined in that respect.

With HNZ I will start to get ready to lighten up if the bottom line is hit. Hopefully not until closer to $2 plus.

Could have avoided that question of yours if I had included both top and bottom extremities in the channel (book says I should) but my methodology is to try to tighten the channel up that covers a large % of the price activity, on the assumption that at times things go wonky like the sudden rush to buy post announcement that pushed the price up to $1.40.

That's my story and I sticking to it.

Medium - long term you may be right, but for me I don't like that the bollingers are narrowing, with the lower band likely to be penetrated soon, or where the MACD is heading and the thinnish of bids currently. The fact that there is possibly insto bids sitting on the bid screen, while offloading at 132cps is a tad concerning.

Only responding to short term technical indicators.

[Beagle]

Institutions positioning themselves for a placement of HER vendor shares soon...as simple as that, no need to make it more complicated than it is.

[winner69]

OMG - Interim Report has the Chairmans /CEO Report in Maori

Diversity starting to mean something for Heartland

Next time we need it in girl talk .... not all those wishy washy warm fuzzy buzz words

Percy - what's well positioned in Maori (used twice)

[winner69]

Page 10 of the Interim Report is good

[winner69]

Net interest margin not mentioned in any of half year announcements or the Interim Report

Can only assume the much touted consistent margin growth has ended and margins are now contracting .....and we don't want to talk about any more. No more pretty graphs

Jeez if they fall back to what other banks achieve we are in trouble.

Competition hotting up. SBS see to have great plans.

[noodles]

Net interest margin not mentioned in any of half year announcements or the Interim Report

Can only assume the much touted consistent margin growth has ended and margins are now contracting .....and we don't want to talk about any more. No more pretty graphs

Jeez if they fall back to what other banks achieve we are in trouble.

Competition hotting up. SBS see to have great plans.
Not sure what you are worried about. Management have stated for quite some time that margin growth will slow. They have been a bank for a while now, so the interest rates they pay to deposit holders are not going any lower. There were no graphs in the interim report last year either.

SBS is getting into 10 year mortages. Not a HNZ business. What else are you concerned about?

[couta1]

Not sure what you are worried about. Management have stated for quite some time that margin growth will slow. They have been a bank for a while now, so the interest rates they pay to deposit holders are not going any lower. There were no graphs in the interim report last year either.

SBS is getting into 10 year mortages. Not a HNZ business. What else are you concerned about?
Noodles reading a report from SBS recently they are just getting started so to speak and are looking to move into different areas definitely competition and a very good organization. They have a diverse loan portfolio including the agriculture sector.

[winner69]

This gives some idea of SBS plans. Their CEO seems pretty dynamic sort
http://www.stuff.co.nz/business/industries/67490728/sbs-the-little-bank-with-big-plans

They say they little ..... ut I was surprised that are not that much 'littler' than Heartland

Always good to keep an eye on the competition

[winner69]

Not sure what you are worried about. Management have stated for quite some time that margin growth will slow. They have been a bank for a while now, so the interest rates they pay to deposit holders are not going any lower. There were no graphs in the interim report last year either.

SBS is getting into 10 year mortages. Not a HNZ business. What else are you concerned about?

margin growth will slow - growth not slowing noodles, probably declining

Maybe we better get Snoopy to calculate for us

Geoff loved that margin chart in his presentations - not included this time around in the presentations.

[Beagle]

All seems okay to me. NIM probably down a bit but that will reflect the change in lending mix with HER loans being power margin.
Lending growth looks sound. They seem very confident of meeting their forecast of $46-48m. Forecast about 10.2 cents EPS and at $1.30 they're on a 2015 PE of 12.75 times which seems cheap for a bank growing weighted average EPS at 13%. Plenty of talk of growth to come in the years ahead. I think Institutions are playing silly buggers with the SP so they can grab themselves a bargain in a potential forthcoming placement regarding stock overhang I previously mentioned.

[percy]

Fantastic report.!!
Maori,and a fine photo of our splendid legal team.
Now to the meaty bits.
The use of "well positioned" twice signals strong hold/buy.
But the real giveaway, was the use of "significant" four times.Used twice signals strong buy,but four times means raging buy.
And to top it all off;"We are beginning the next phase of our evolution and our sights are firmly on growth."
Wonderful exciting stuff !!!!.

[Baa_Baa]

Seems an excellent interim report to me. Some may see good buying opportunity here right on the 50EMA at $1.30

[SCOTTY]

Fantastic report.!!
Maori,and a fine photo of our splendid legal team.
Now to the meaty bits.
The use of "well positioned" twice signals strong hold/buy.
But the real giveaway, was the use of "significant" four times.Used twice signals strong buy,but four times means raging buy.
And to top it all off;"We are beginning the next phase of our evolution and our sights are firmly on growth."
Wonderful exciting stuff !!!!.
Ah yes, the legal team - beauty and brains :)
HNZ have bought a small holding in ORA HQ Ltd. According to the Companies Office the holding is 12%. Could be interesting?

[vin]

Contemplating jumping in again.. hmm

[Harvey Specter]

HNZ have bought a small holding in ORA HQ Ltd. According to the Companies Office the holding is 12%. Could be interesting?Unusual. Not sure how this ties into banking? My understanding is they are a company that helps SME with online advertising/marketing. Interesting that Ora HQ current Finance partner is Westpac so maybe there is a finance element to it. Which maybe why they have kept the investment quiet - the dont want it public till the contract with Westpac expires.

[Bjauck]

The offer volume is great too. Is this an institutional tactic to lead the price lower to get a lower DRP price? I am beginning to wish that I had not cut my DRP participation to 50%. At meetings do the speakers use a NZSL signer so that all three official languages are covered?

[Beagle]

I find this pandering to minorities irksome.

[winner69]

The offer volume is great too. Is this an institutional tactic to lead the price lower to get a lower DRP price? I am beginning to wish that I had not cut my DRP participation to 50%. At meetings do the speakers use a NZSL signer so that all three official languages are covered?

Methinks there should be Braille version of the report, or a talking book version

[winner69]

I find this pandering to minorities irksome.

Be careful Roger. Next ASM you go to you might be welcomed with a powhiri

[Bjauck]

All's good as long as we don't have to be cheese-eating surrender monkeys.

[Bjauck]

I find this pandering to minorities irksome. English speakers were once a minority in NZ. After a lot of pandering to them they became the majority!

[percy]

English speakers were once a minority in NZ. After a lot of pandering to them they became the majority!

Classic.!!!!!!!!!!!!!!!!!!!!!!!!!! lol.

[Harvey Specter]

English speakers were once a minority in NZ. After a lot of pandering to them they became the majority!Talking of Panda's, shouldn't it be in Chinese based on where things are heading ;)

[Beagle]

English speakers were once a minority in NZ. After a lot of pandering to them they became the majority!

Thank you Captain Obvious. I assume you'd also like the annual report reproduced in Mandarin, Braille, French, Latin, Greek, Cantonese, Vietnamese and a few other languages too.

[winner69]

Thank you Captain Obvious. I assume you'd also like the annual report reproduced in Mandarin, Braille, French, Latin, Greek, Cantonese, Vietnamese and a few other languages too.

I'd be happy with just Plain English without all the corporatese crap

[Beagle]

I'd be happy with just Plain English without all the corporatese crap

Mate Its a VERY SAD day for excessive political correctness. An annual report with parts of it translated into Maori and Jeremy Clarkson fired by the BBC both on the same day !! I think I need a drink...opps am I even allowed to say that these days...

[Bjauck]

Mate Its a VERY SAD day for excessive political correctness. An annual report with parts of it translated into Maori and Jeremy Clarkson fired by the BBC both on the same day !! I think I need a drink...opps am I even allowed to say that these days...
Aunty's loss could be our gain: New job for Jezza...head of PR for HNZ? With Prince Philip as adviser...

[Onion]

I'd be happy with just Plain English

You did get English. You haven't had to learn another language. You can easily elect to skip over the section in Maori.

Whether it is "Plain English" is another matter. The Maori/English distinction is independent of the corporatese/plain distinction.

And winner, I actually think you understand corporatese better than most (I think you demonstrate that on this forum pretty well) -- even if you aren't a speaker of it yourself!:)

[winner69]

You did get English. You haven't had to learn another language. You can easily elect to skip over the section in Maori.

Whether it is "Plain English" is another matter. The Maori/English distinction is independent of the corporatese/plain distinction.

And winner, I actually think you understand corporatese better than most (I think you demonstrate that on this forum pretty well) -- even if you aren't a speaker of it yourself!:)

I put the Chairman/CEO (English version) through the old buzzsaw. Some 62 instances of buzz words (a high 8%) in that portion alone. Need to change their PR company methinks

[Beagle]

Mr Market quite obviously didn't like the inclusion of Maori translation, ( a first for a N.Z. company report pandering to excessive political correctness ?).
Says something about the culture of the company and makes me wonder how many expensive cultural sensitivity courses staff have to be sent on whether they like it or not (and I'd speculate the vast majority strongly dislike it), to be seen to be politically correct. I am inclined towards voicing my displeasure about this at the next ASM.

[Baa_Baa]

If complaining it will resonate with them more clearly if you use the correct lingo, it is not political correctness. Your complaint appears to be in your view an unnecessary focus and expense on Corporate Social Responsibility and Diversity. (I learnt that these things are important to a bank while working for a bank). Whether or not you agree with the expense etc it is a difficult proposition to stand and argue at an AGM that the bank should not be socially responsible nor embrace diversity, in gender, culture, language etc. It may reflect on you as heartlandless. I'm not saying that I agree or disagree with you, I may be conflicted as a shareholder.


Mr Market quite obviously didn't like the inclusion of Maori translation, ( a first for a N.Z. company report pandering to excessive political correctness ?).
Says something about the culture of the company and makes me wonder how many expensive cultural sensitivity courses staff have to be sent on whether they like it or not (and I'd speculate the vast majority strongly dislike it), to be seen to be politically correct. I am inclined towards voicing my displeasure about this at the next ASM.

[Beagle]

"Heartlandless" that's a good one mate :)

[vin]

Topped up $1.29, hanging out for the divvy!

[Bjauck]

Mr Market quite obviously didn't like the inclusion of Maori translation, ( a first for a N.Z. company report pandering to excessive political correctness ?).
Says something about the culture of the company and makes me wonder how many expensive cultural sensitivity courses staff have to be sent on whether they like it or not (and I'd speculate the vast majority strongly dislike it), to be seen to be politically correct. I am inclined towards voicing my displeasure about this at the next ASM.
I disagree that it is "excessive" political correctness to provide a Maori translation. Politically correct it may be. However, as English, Maori and NZSL are all official languages of the country and it could be argued that all public companies should have available reports in all of the official languages.

Maybe the motive is more mercenary as it could well be a deliberate marketing and image-making tactic by Heartland to include Maori, to emphasize that it is a New Zealand Bank as opposed to the big Aussie owned banks trading in NZ.

[dingoNZ]

I disagree that it is "excessive" political correctness to provide a Maori translation. Politically correct it may be. However, as English, Maori and NZSL are all official languages of the country and it could be argued that all public companies should have available reports in all of the official languages.

Maybe the motive is more mercenary as it could well be a deliberate marketing and image-making tactic by Heartland to include Maori, to emphasize that it is a New Zealand Bank as opposed to the big Aussie owned banks trading in NZ.

I absolutely agree with this, I have no problem with having Maori language in it, and actually quiet like the idea! Makes them stand out!

[Mic]

I agree too. I think it's a brilliant idea.

[vin]

I can only see benefits from producing this report in both English and Maori. To me it would seem to encourage Maori to invest with HNZ.

[artemis]

Not bothered either way about English / Maori. But it is not an expensive move, and might get them some publicity, or even one of the annual report awards. If either of those things happen, it will be cheap publicity for them.

[Beagle]

I disagree that it is "excessive" political correctness to provide a Maori translation. Politically correct it may be. However, as English, Maori and NZSL are all official languages of the country and it could be argued that all public companies should have available reports in all of the official languages.

Maybe the motive is more mercenary as it could well be a deliberate marketing and image-making tactic by Heartland to include Maori, to emphasize that it is a New Zealand Bank as opposed to the big Aussie owned banks trading in NZ.

Perish the thought but I see your perspective with your latter point.

[zigzag]

Mate Its a VERY SAD day for excessive political correctness. An annual report with parts of it translated into Maori and Jeremy Clarkson fired by the BBC both on the same day !! I think I need a drink...opps am I even allowed to say that these days...

Bring back the "Page Three Girl" That would add some interest to the annual report!

[Bjauck]

i
Perish the thought but I see your perspective with your latter point.
You may change your mind when you see a video clip of a signer communicating "increased profits" and "exceeding our expectations" and "well-positoned" :)

[noodles]

Anybody know what Jeff is referring to in this statement from pg.5 of the interim
"A key focus area within the Household division will be the consumer finance market. Our product offering will be expanded in this market to provide products to customers who are currently under-banked by the mainstream banks."
https://www.nzx.com/files/attachments/210318.pdf

[Ascend]

Anybody know what Jeff is referring to in this statement from pg.5 of the interim
"A key focus area within the Household division will be the consumer finance market. Our product offering will be expanded in this market to provide products to customers who are currently under-banked by the mainstream banks."
https://www.nzx.com/files/attachments/210318.pdf
The funding line they have with harmoney (P2P lending)?

[winner69]

Anybody know what Jeff is referring to in this statement from pg.5 of the interim
"A key focus area within the Household division will be the consumer finance market. Our product offering will be expanded in this market to provide products to customers who are currently under-banked by the mainstream banks."
https://www.nzx.com/files/attachments/210318.pdf

The paragraph continues (part in red) which sheds some light on meaning -

"A key focus area within the Household division will be the consumer finance market. Our product offering will be expanded in this market to provide products to customers who are currently under-banked by the mainstream banks. New technology will play an increasingly significant role in our consumer finance strategy as we continue to see customers seeking more convenient and personalised alternatives."

Not Plain English is it?

[iceman]

I can see their investment in Ora HQ fitting into this statement. Use Ora to find good startup businesses, help them plan their business and marketing plans using Heartland loans to grow. Normally very difficult for startups to get funding from big banks so a very interesting concept. The more I think about this HNZ investment, the more I like it. Ditto Harmoney !



Anybody know what Jeff is referring to in this statement from pg.5 of the interim
"A key focus area within the Household division will be the consumer finance market. Our product offering will be expanded in this market to provide products to customers who are currently under-banked by the mainstream banks."
https://www.nzx.com/files/attachments/210318.pdf

[Beagle]

I can see their investment in Ora HQ fitting into this statement. Use Ora to find good startup businesses, help them plan their business and marketing plans using Heartland loans to grow. Normally very difficult for startups to get funding from big banks so a very interesting concept. The more I think about this HNZ investment, the more I like it. Ditto Harmoney !
My turn to respectfully disagree. What I've witnessed over my 30+ year career as an accountant is that start-up's are incredibly risky. Take restaurants for instance. At one point BNZ had anecdotal evidence that there was an 80% failure rate within two years on a new restaurant opening its doors. Plant and equipment can often only be liquidated for 10-20 cents on the dollar...you do the maths. An old bank manager once told me at a function after he'd had enough lubricant to be honest, that he's never seen a cash flow forecast for a new start-up that was worth the paper it was printed on...and I tend to agree.

Likewise I have reservations about Harmoney...all of their loan processes are computerised, how rigorous are front end credit checking procedures, their operating and debt recovery systems and procedures ?, what sort of level of delinquencies will materialise over time ? (Notice that bad and doubtful debt provisioning is already up in the half year report just released ?) Naturally it makes for happy reading to have all this new lending business being generated but what net effect over time as delinquencies rise ? Finally what has Ora HQ got to do with the core business of HNZ ? Perhaps they need to explain themselves better.

Plenty of questions for the next ASM. I hold but am cautious. I guess I must be an old fashioned bloke that believes loans should be really thoroughly vetted in an old fashioned way. I like business's, (and Kiwi cricketers, GO THE BLACK CAPS) !!!!!! that have plenty of runs on the board to prove their credibility. The most I'd lend a start-up is the worth of a cricket bat and gloves and tell them to go prove yourself :)

[iceman]

All absolutely valid mate. It will all be about how it is risk managed. But like Jeff said in the Report, conventional banking is aware of and constantly evaluating the threat to their business models by fast changing technology and new ways of banking/funding. You look at the growth of crowd funding and P2P in the UK and USA for example. Whether old conservatives like you and I like it, it is happening very fast right in front of our eyes !


My turn to respectfully disagree. What I've witnessed over my 30+ year career as an accountant is that start-up's are incredibly risky. Take restaurants for instance. At one point BNZ had anecdotal evidence that there was an 80% failure rate within two years on a new restaurant opening its doors. Plant and equipment can often only be liquidated for 10-20 cents on the dollar...you do the maths. An old bank manager once told me at a function after he'd had enough lubricant to be honest, that he's never seen a cash flow forecast for a new start-up that was worth the paper it was printed on...and I tend to agree.

Likewise I have reservations about Harmoney...all of their loan processes are computerised, how rigorous are front end credit checking procedures, their operating and debt recovery systems and procedures ?, what sort of level of delinquencies will materialise over time ? (Notice that bad and doubtful debt provisioning is already up in the half year report just released ?) Naturally it makes for happy reading to have all this new lending business being generated but what net effect over time as delinquencies rise ? Finally what has Ora HQ got to do with the core business of HNZ ? Perhaps they need to explain themselves better.

Plenty of questions for the next ASM. I hold but am cautious. I guess I must be an old fashioned bloke that believes loans should be really thoroughly vetted in an old fashioned way. I like business's, (and Kiwi cricketers, GO THE BLACK CAPS) !!!!!! that have plenty of runs on the board to prove their credibility. The most I'd lend a start-up is the worth of a cricket bat and gloves and tell them to go prove yourself :)

[Harvey Specter]

Roger - remember that harmony takes no risk on any loans. All it does is clip the ticket.

[Cricketfan]

Roger - remember that harmony takes no risk on any loans. All it does is clip the ticket.

There won't be many tickets to clip though if investors feel the loans are too risky.

[777]

Do think that Heartland possibly lend into some of Harmoney's loans?

[axe]

Do think that Heartland possibly lend into some of Harmoney's loans?

I believe they provided some initial "seed"

The sum Heartland would lend via Harmoney is a "meaningful" one, Greenslade said.
"It's a meaningful amount of money to get them going. That money's lending through the platform, it's not to Harmoney, (but rather) into the various risk buckets as borrowers come in."

source : http://www.interest.co.nz/business/71843/heartland-bank-says-it-has-taken-10-stake-peer-peer-lender-harmoney

[Beagle]

IIRC they lent $17m through the Harmoney platform in the half year to 31 December 2014 and have made an initial advance available of up to $100m so the integrity of their system's, procedures and recovery processes when loans fall into arrears is very important to HNZ. I think HNZ management would have undertaken thorough due diligence before investing in and making significant funds available through Harmoney so we should be okay.

[noodles]

My turn to respectfully disagree. What I've witnessed over my 30+ year career as an accountant is that start-up's are incredibly risky. Take restaurants for instance. At one point BNZ had anecdotal evidence that there was an 80% failure rate within two years on a new restaurant opening its doors. Plant and equipment can often only be liquidated for 10-20 cents on the dollar...you do the maths. An old bank manager once told me at a function after he'd had enough lubricant to be honest, that he's never seen a cash flow forecast for a new start-up that was worth the paper it was printed on...and I tend to agree.

Likewise I have reservations about Harmoney...all of their loan processes are computerised, how rigorous are front end credit checking procedures, their operating and debt recovery systems and procedures ?, what sort of level of delinquencies will materialise over time ? (Notice that bad and doubtful debt provisioning is already up in the half year report just released ?) Naturally it makes for happy reading to have all this new lending business being generated but what net effect over time as delinquencies rise ? Finally what has Ora HQ got to do with the core business of HNZ ? Perhaps they need to explain themselves better.

Plenty of questions for the next ASM. I hold but am cautious. I guess I must be an old fashioned bloke that believes loans should be really thoroughly vetted in an old fashioned way. I like business's, (and Kiwi cricketers, GO THE BLACK CAPS) !!!!!! that have plenty of runs on the board to prove their credibility. The most I'd lend a start-up is the worth of a cricket bat and gloves and tell them to go prove yourself :)
There are many SME's that require factoring finance. Especially if they are project based. They need to pay their employees before the invoices are paid. It can be a very profitable form of finance. CGR.AX charge 30% interest for this service. It requires a lot of due diligence. The big banks don't compete in this area. So perfect for HNZ. DPC have also murmured that they are entering this business.

Ora HQ hooks into Xero. I can imagine a user getting a targeted Heartland Finance prompt if their forecast cash balance moves below zero and they have a debtors balance to cover it. Genius!

[noodles]

IIRC they lent $17m through the Harmoney platform in the half year to 31 December 2014 and have made an initial advance available of up to $100m so the integrity of their system's, procedures and recovery processes when loans fall into arrears is very important to HNZ. I think HNZ management would have undertaken thorough due diligence before investing in and making significant funds available through Harmoney so we should be okay.
I am very happy that HNZ are moving with the times. The big banks are burying their heads in the sand.

[Baa_Baa]

There are many SME's that require factoring finance. Especially if they are project based. They need to pay their employees before the invoices are paid. It can be a very profitable form of finance. CGR.AX charge 30% interest for this service. It requires a lot of due diligence. The big banks don't compete in this area. So perfect for HNZ. DPC have also murmured that they are entering this business.

Ora HQ hooks into Xero. I can imagine a user getting a targeted Heartland Finance prompt if their forecast cash balance moves below zero and they have a debtors balance to cover it. Genius!

BNZ invoice finance https://www.bnz.co.nz/business-banking/loans-and-finance/invoice-finance
Westpac invoice finance http://www.westpac.co.nz/wib/global-transactional-services/payments-innovation/paymentsplus/
ANZ supply chain finance http://www.anz.co.nz/institutional/trade-supply-chain/

The real challenge for the banks is approving the payer (supplier) to participate firstly, and then early payment by the bank to the payee, on behalf of the payer when the goods sold by the supplier, cannot be held or have no value as security by/to the bank.

The high finance rates are related to the higher risks. From experience the payees (suppliers) that take-up invoice finance are typically risky cash flow poor businesses going hand to mouth month to month.

More prudently run businesses, with sufficient treasury/capital management nouse typically didn't take-up invoice finance options because they could raise a line of credit which was cheaper.

The big well run businesses with well managed cashflow simply aren't interested, they already have the lowest interest lines of credit.

Factoring finance still has a legacy of stigma attached to it in banking, it was designed for and availed of by the most needy customers, ergo the most risky.

I'm not sure that Heartland should be focusing on factoring finance, and should explain clearly to shareholders why products like this at the fringes of banking finance warrant the investment or the risk.

BAA

[percy]

Book wholesalers/importers were told by two major national book retailers they now demanded 60 days,not 30 days terms.[I do not know the terms of trade the third national retailer demands]
Diary/calendar wholesalers now have to have their products delivered into store by late October with payment due end of January.
Extended credit terms open the opportunities for factoring finance.

[Baa_Baa]

And Trade Payments times are progressively reducing.

D&B March 2014 http://dnb.co.nz/article-tpa-bills-paid-in-record-time.html
D&B October 2014 http://dnb.co.nz/article-tpa-corporate-sector-sees-cash-flowing.html

A declining market for invoice factoring.

BAA

[winner69]

OMG price now 128

Below the channel line and below an ATR stop loss level

At 128 that's nearly 10% down from a recent high

Should be selling but that would reduce the price more, didn't think liquidity would happen

However as Sergeant Schultz said 'I see nothink' so all honky dory.
https://m.youtube.com/watch?v=PibDMGxiyJw

Good discipline eh, seeing nothing and hoping

[winner69]

OMG it's down to 127

When the 46 million or whatever shares hit the market it will be less than 120. Remember they only 'cost' 90 cents so even 120 a real bonus for the vendors.

I'm OK as I see nothink

[dingoNZ]

When does escrow end?

[winner69]

When does escrow end?

I think Roger said the day after tomorrow being April Fools Day

[RTM]

I can cope with fluctuation of the price. As I know I will never sell and buy at the right times.
However I am really wondering about continuing to participate in the Dividend Reinvestment Plan. I seem to remember that the price has dropped under the DRP price more than once in the past, quite soon after. And here we are again. From now on think I'll take the cash and then decide what to do with it.


OMG price now 128

Below the channel line and below an ATR stop loss level

At 128 that's nearly 10% down from a recent high

Should be selling but that would reduce the price more, didn't think liquidity would happen

However as Sergeant Schultz said 'I see nothink' so all honky dory.
https://m.youtube.com/watch?v=PibDMGxiyJw

Good discipline eh, seeing nothing and hoping

[Beagle]

OMG it's down to 127

When the 46 million or whatever shares hit the market it will be less than 120. Remember they only 'cost' 88 cents I think so even 120 a real bonus for the vendors.

I'm OK as I see nothink

Its like the cricket isn't it. Disappointing but they did well overall in the CWC. SP lately has been disappointing but has done well since ASM on 31 October 2014 when the most optimistic, (well lubricated), of us thought $1.20 by next ASM would be a good result. It will be good when that HER vendor's overhang is gone...that's what's depressing the SP IMHO.

[percy]

We have known for sometime The Senior's escrow shares are able to sold in April.
This was part of the agreement when Heartland brought the REL business.
There were any number of avenues for these shares;
1]Seniors could retain them.
2]A trade sale, to either a small Aussie Bank,or a NZ insto such as Kiwi Bank or AMP buying them.
3] A share buy back by HNZ.With their newly approved,by NZ Reserve Bank,lower capital requirement,and slightly lower divie than was expected,this course of action appeared to be on.
4] An underwritten share placement.
The share price action of late would indicate to me this is what the market now expects.
I am looking forward to seeing what happens,but more interested in Heartland achieving the aggressive growth they foresee in the interim report.

[Bjauck]

I am not sure if that was a tongue-in-cheek post...The previous dividend reinvestment was at (I think) $1.015 in Oct 2014. At the current price of $1.27. You have had about a a 25% capital appreciation in the six months since then plus the current dividend on your DRP. You could have taken that dividend as cash and earned a 2% gross interest. The DRP a year ago was at 86c. If watching daily fluctuating prices gives you DRP participation remorse maybe your money should be in a bank deposit. However, if you are perfect at timing at buying in dips and selling at peaks, you may well have been able to beat the return on the DRP.
I can cope with fluctuation of the price. As I know I will never sell and buy at the right times.
However I am really wondering about continuing to participate in the Dividend Reinvestment Plan. I seem to remember that the price has dropped under the DRP price more than once in the past, quite soon after. And here we are again. From now on think I'll take the cash and then decide what to do with it.

[RTM]

No...not at all. I realise that over the longer term I am well ahead with DRP. However I seem to recall having the same feeling that I am having now with respect to the DRP on previous occasions. e.g. Strike price $1.32. Current Price $1.28. Accordingly I am opting out. Happy to hold tho.



I am not sure if that was a tongue-in-cheek post...The previous dividend reinvestment was at (I think) $1.015 in Oct 2014. At the current price of $1.27. You have had about a a 25% capital appreciation in the six months since then plus the current dividend on your DRP. You could have taken that dividend as cash and earned a 2% gross interest. The DRP a year ago was at 86c. If watching daily fluctuating prices gives you sleepless nights maybe your money should be in a bank deposit. Unless you are perfect at timing at buying in dips and selling at peaks, your previous DRP participation has been financially rewarding.

[winner69]

Its like the cricket isn't it. Disappointing but they did well overall in the CWC. .

And that ended in tears eh Roger

Trading not meant to end in tears

Black Caps might be able to wait for another 4 years to have a go at the CWC again .... I cant wait that long with HNZ if it is going to stay down at these levels

[percy]

And that ended in tears eh Roger

Trading not meant to end in tears

Black Caps might be able to wait for another 4 years to have a go at the CWC again .... I cant wait that long with HNZ if it is going to stay down at these levels

Going from the aggressive language in the interim report, I don't think you will have to wait around too long.!!!

[Beagle]

And that ended in tears eh Roger

Trading not meant to end in tearsBlack Caps might be able to wait for another 4 years to have a go at the CWC again .... I cant wait that long with HNZ if it is going to stay down at these levels

None of us are thrilled to see HNZ under $1.30 but depending upon your timeframe for investment I don't see it as trading, rather as a long term investment. Have some patience and I am sure we will be well rewarded. Or you could just put that funny youtube clip on constant reply loop on your computer till the price is north of $1.30 again :D
I have plenty of dry powder...if this price gets a little more silly I might have to double down on my investment !!

[winner69]

Well well

Consumer NZ do a survey on NZ banks ..... 9,000 members participated

Heartland not even on the list of results .... means zilch members bank with Heartland? Heartland not seen as a BANK? Heartland brand recognition zilch?

Apparently NZ owned banks have a lot going for them according to the report.

Weird eh

PS to Percy - Coop Bank had highest customer satisfaction rating of the 10 listed

The small print said that a bank needed to get more than 30 responses to appear in their tables and report. so at best Heartland Market share is 29/9000 or about 3%

[Beagle]

Other thing that could be affecting the SP (incl the market in general) is that 7 April is a big tax payment date, (2014 terminal tax) for many people.

[percy]

Well well

Consumer NZ do a survey on NZ banks ..... 9,000 members participated

Heartland not even on the list of results .... means zilch members bank with Heartland? Heartland not seen as a BANK? Heartland brand recognition zilch?

Apparently NZ owned banks have a lot going for them according to the report.

Weird eh

PS to Percy - Coop Bank had highest customer satisfaction rating of the 10 listed

The small print said that a bank needed to get more than 30 responses to appear in their tables and report. so at best Heartland Market share is 29/9000 or about 3%

Pleasing to see The Coop Bank doing so well.
Wonder how long it will take Heartland to appear on Consumers' list,and will they top the list first time up?
So much to look forward to.!!!

[vorno]

Pleasing to see The Coop Bank doing so well.
Wonder how long it will take Heartland to appear on Consumers' list,and will they top the list first time up?
So much to look forward to.!!!

...Perhaps they don't know that Heartland exists!

[Beagle]

Well well

Consumer NZ do a survey on NZ banks ..... 9,000 members participated

Heartland not even on the list of results .... means zilch members bank with Heartland? Heartland not seen as a BANK? Heartland brand recognition zilch?

Apparently NZ owned banks have a lot going for them according to the report.

Weird eh

PS to Percy - Coop Bank had highest customer satisfaction rating of the 10 listed

The small print said that a bank needed to get more than 30 responses to appear in their tables and report. so at best Heartland Market share is 29/9000 or about 3%

Careful you'll scare the pussy's and weak holders out of their shares and cause resentment when they're $1.50+ late this year :)

[winner69]

Weird that Heartland didn't even get 30 respondents in that Consumer survey

Would have been a bit of good publicity if nothing else

Maybe Maori don't subscribe to Consumer?

[Baa_Baa]

For believers in HNZ, the chart says good buying. If it went to $1.25, which it might at $1.28 close today, I'll certainly stump up some more $, that's good support. For the chartists who don't like gaps, if it closed the gap to $1.20-$1.18 I'll buy more. These buy-in opportunities are gifts. It only depends on whether you're in this for the short game or the long game.

7249

BAA

[JohnnyTheHorse]

For believers in HNZ, the chart says good buying. If it went to $1.25, which it might at $1.28 close today, I'll certainly stump up some more $, that's good support. For the chartists who don't like gaps, if it closed the gap to $1.20-$1.18 I'll have to double down. These buy-in opportunities are gifts. It only depends on whether you're in this for the short game or the long game.

7249

BAA

Did you look at your chart? Countless sell signals. Hopefully a fakeout eh?

[winner69]

Did you look at your chart? Countless sell signals. Hopefully a fakeout eh?

BaaBaa did say it was for believers (in the long game) so you only see what you want to see

Sorry BaaBaa, nothing personal and I know you have had a tough day elsewhere

[Xerof]

Winner, if you take into account the parentage of Heartland, the traditional owners of their liabilities are Marac debenture holders, Building Society depositors, and, err, I forget what the third bit was. What I'm sayin' is they aren't your 'Main Street' banking customers, who have a cheque account, mortgage and credit card. What this has to do with who would answer a survey by Consumer Mag, I have no idea, and have just realised that I have lost my train of thought on why I am even commenting :scared: Hopefully, you get my drift

BAA, I agree with JtH, plenty of sell signals on your chart, but if I was to suggest any buying level, I would be a little patient and look for the GAP to be closed, so 1.18 would be it (for me). That level is also a previous resistance, and will now provide good support. Plan B in the event 1.18 is not seen would be to enter on a close above your down-sloping red line, which would represent a bullish breakout of the "falling wedge", or perhaps, a 'flag'. A few more days will clarify things I feel.

As you say, in the long run, whats 10 cents in the scheme of things.......HTH

[Baa_Baa]

Hey no worries Winner, and no offence taken either. HNZ imho is a long game. If I'd wanted to sell I would have exited the re-entry to the Linear Regression Channel that you posted some few days ago (not on my daily chart, but it is on my weekly chart). The multiple daily 'sell signals' have past. The longs who got the collywobbles would've sold the 50EMA breakdown at least. Anyone holding now should be looking to either leverage the price advantage (as Xerof says, what's 10c in the scheme of things) or reconsider their reasoning for ignoring the sell signals, i.e. they're long but wondering why they didn't do anything about it and possibly shouldn't be in it. JMHO folks.

Here's the weekly chart if you like. It's still above my fav 14EMA but $1.18 is solid support if the johnny come lately's lose the faith. Now that would be a buy, or anything under it. If it crumbled to the 40week EMA or worse the 60week EMA, I'd guess by then only the faithful would be left holding, and probably bought everyone exiting on the way down as well. Who knows really? If you're not long I'm talking past you.



BAA


BaaBaa did say it was for believers (in the long game) so you only see what you want to see

Sorry BaaBaa, nothing personal and I know you have had a tough day elsewhere

[winner69]

BaaBaa you said '...reconsider their reasoning for ignoring the sell signals'

As I said earlier its a case of 'I see nothink'

I'm in love with HNZ

[Baa_Baa]

Yes I did say that didn't I. Sometimes I wonder whether it would be better to not have posted the charts, or made some bold statements, but I didn't make up the chart, the market did. We are still very early in the HNZ story and I hope we will look back on this and have a good laugh about how we worried about a healthy correction in the SP but took the opportunity to bolster our positions.

cheers, BAA


BaaBaa you said '...reconsider their reasoning for ignoring the sell signals'

As I said earlier its a case of 'I see nothink'

I'm in love with HNZ

[percy]

There has been a lot of "noise" in the past two years about Heartland, both on the charts, and here on sharetrader.You could say;"after all said and done.there has been more said, than done."
However, the share price just keeps above the increasing 200 day EMA.
The best indicator of where Heartland is heading is Heartland's reports and presentations,BECAUSE Heartland achieve what they say they will do.!!!!
The latest report is the most bullish I have seen from Heartland.Why, you may ask your self.???
It is because Heartland know what they want to achieve, and they know how they are going to achieve it!
So the only "noise" worth listening to, is the "noise" Heartland make themselves.!!!

[iceman]

Like we discussed face to face last week my friend, this is the most bullish report HNZ has ever put out. Up to investors how they interpret that message !
There has been a lot of "noise" in the past two years about Heartland, both on the charts, and here on sharetrader.You could say;"after all said and done.there has been more said, than done."
However, the share price just keeps above the increasing 200 day EMA.
The best indicator of where Heartland is heading is Heartland's reports and presentations,BECAUSE Heartland achieve what they say they will do.!!!!
The latest report is the most bullish I have seen from Heartland.Why, you may ask your self.???
It is because Heartland know what they want to achieve, and they know how they are going to achieve it!
So the only "noise" worth listening to, is the "noise" Heartland make themselves.!!!

[winner69]

Done some playing around with financial numbers, in particular net interest margins (NIM)

Looks like H115 NIM down a marginal 0.2% points at most.

Nothing to worry about and it's all onwards and upwards in a noisy world from here.

Fundamentally $1.60 by next ASM but in the mean time re current share price I see nothink

[Beagle]

There has been a lot of "noise" in the past two years about Heartland, both on the charts, and here on sharetrader.You could say;"after all said and done.there has been more said, than done."
However, the share price just keeps above the increasing 200 day EMA.
The best indicator of where Heartland is heading is Heartland's reports and presentations,BECAUSE Heartland achieve what they say they will do.!!!!
The latest report is the most bullish I have seen from Heartland.Why, you may ask your self.???
It is because Heartland know what they want to achieve, and they know how they are going to achieve it!
So the only "noise" worth listening to, is the "noise" Heartland make themselves.!!!

Well said mate. If those feeble / scatty holders push it down a few more cents I'll really open my shoulders and it'll be HAMMER TIME !! :D

[winner69]

Share price today down ..... I see nothink

[vorno]

Share price today down ..... I see nothink

Just crossed the 60-day line!

[winner69]

Just crossed the 60-day line!

I see nothink!!!

[couta1]

Just crossed the 60-day line!
A 60 day line or a 6 year line,choose your poison.

[Beagle]

I see nothink!!! and know nothing
https://www.youtube.com/watch?v=s6EaoPMANQM

[percy]

Now that there's a result and therefore some more unknowns removed, could this pave the way for HNZ to reattempt a takeover of MTF?

http://www.nbr.co.nz/article/court-appeal-rejects-mtf-sportzone-appeal-over-credit-fees-bd-170819

Well I hope so as it will be a perfect bolt on for Heartland.
It will also be good for MTF dealers and customers knowing they have the backing of Heartland Bank.
I hope others can see clarity in the judgement,as it was clear as mud to me.!!
I see the whole argument being over the fees of $256 per 39 Sportzone loan.Under $10,000.!!!
I was going to ring MTF's Glenn Todd and ask him,but thought I would appear to be a dummy, so did not do so.
I expect Heartland's award winning legal team will be able to fully understand the judgement,and the liabilities that MTF face with it.

[Beagle]

The decision doesn't seem to make sense to me. Aren't loan establishment fees a well established part of the finance industry ? Loan application review, credit checking and loan implementation costs are a significant administration burden on any finance company / bank and for pragmatic reasons are often recovered through the original loan establishment fee as otherwise the interest rate that would have to be charged to recover these admin costs through normal interest would look astronomical for smaller loans. It wouldn't surprise me to see this appealed to the Supreme Court.

[noodles]

Well I hope so as it will be a perfect bolt on for Heartland.
It will also be good for MTF dealers and customers knowing they have the backing of Heartland Bank.
I hope others can see clarity in the judgement,as it was clear as mud to me.!!
I see the whole argument being over the fees of $256 per 39 Sportzone loan.Under $10,000.!!!
I was going to ring MTF's Glenn Todd and ask him,but thought I would appear to be a dummy, so did not do so.
I expect Heartland's award winning legal team will be able to fully understand the judgement,and the liabilities that MTF face with it.
Prior to the decision, there was a massive buy of MTFHC at 69c. This buyer has disappeared. Maybe he/she was nervous about the court case result as well.

[percy]

The decision doesn't seem to make sense to me. Aren't loan establishment fees a well established part of the finance industry ? Loan application review, credit checking and loan implementation costs are a significant administration burden on any finance company / bank and for pragmatic reasons are often recovered through the original loan establishment fee as otherwise the interest rate that would have to be charged to recover these admin costs through normal interest would look astronomical for smaller loans. It wouldn't surprise me to see this appealed to the Supreme Court.

My simple read of the situation is that the Commerce Commission feels it is unfair for overdue,at fault loans to be hit with recovery fees,and charges.!
The fact that they were agreed to by the borrower, when they took out their loan appears to make no difference?? Yeah right?
They would appear to favour every loan pays a higher interest rate to cover the at risk loans.
So 95% of good payers have to cover the 5% of poor payers??? Madness!!!
Surely the 95% can take the Commerce Commission to court to stop them having to cover the 5% 's extra costs?
So lets look at Harmoney and see what interest rate these borrowers would have to pay?
Very high!!!
The Commerce Commission has not looked at the huge costs that are involved when loans go bad.
You would think the Courts, with their massive overdue fines, would have a better understanding of the costs of recovery.

[couta1]

Percy I think you would know well by now that the ComCom are the most incompetent bunch of academic beaurocrats to ever exist in NZ, they live in their own pretend world, a bit like children living in fantasies only with far more serious consequences including the destruction of individual and corporate wealth.

[Marilyn Munroe]

This omnishambles it the confluence of a wish by legislators to get loan sharks and the laws of unintended consequences.

Both the legislation and this court case revolves around using fees as a profit centre rather than for the recovery of costs. The legislation tries to prevent this but ended up being over-broad and overreaching.

Previously in order to appear competitive some lenders and retailers would advertise a low interest rate and then seek to recover this discounting with masked fees.This was viewed by the legislators as a deceptive practise.

Rogers point about the recovery of profit margins is a valid one. The doctrinaire approach by MBIE that all profits should be recovered through interest charges is bad because there is no reason that I can think of that makes a disclosed explicit charge for the lenders profit abhorrent and as Roger points out in some circumstances is the more reasonable approach.

My solution to this would be to allow loans with a less rule bound approach where the loan is tied to a physical purchase and this purchase secures the loan on a non recourse basis.

Non recourse loans are where the recovery of a loan in default is limited to the item used as security. So if a lender loans shonkily to an at risk borrower it more likely to blow up their face with less prospect of a full recovery. This in my opinion will do more to encourage responsible lending than poor rules badly enforced by MBIE.

My idea would divert MBIE efforts to where it is really needed, cash advances from pay day lenders

Boop boop de do
Marilyn

[percy]

Marilyn Munroe.
Your post makes good sense to me.

[Marilyn Munroe]

Marilyn Munroe.
Your post makes good sense to me.

While my proposal may be a good idea there is a problem.

It would require bureaucrats from MBIE who are currently sitting behind their desks interpreting rules so vacuous it takes the Court of Appeal to sort them out to change to walking up driveways with barking dogs in less friendly parts of town and talking to whoever they meet about things like compliance, processes, and codes of conduct.

How likely do think that will be?

Boop boop de do
Marilyn

[percy]

While my proposal may be a good idea there is a problem.

It would require bureaucrats from MBIE who are currently sitting behind their desks interpreting rules so vacuous it takes the Court of Appeal to sort them out to change to walking up driveways with barking dogs in less friendly parts of town and talking to whoever they meet about things like compliance, processes, and codes of conduct.

How likely do think that will be?

Boop boop de do
Marilyn
I still think the answer is the courts.Their record of debt collection is hopeless.Just take one brave QC to ask the judge, if he could tell him how successful are the courts with their collections!!! Point proved???

[percy]

Today's announcement means Seniors' 43,000,000 shares or 9.282% can now be sold.
The sp weakness has been signalling a placement.I believe this will be done through Forbar,but I do not know at what price.

[Cool Bear]

Today's announcement means Seniors' 43,000,000 shares or 9.282% can now be sold.
The sp weakness has been signalling a placement.I believe this will be done through Forbar,but I do not know at what price.

Percy, I read the announcement as that the 43m shares HAD been sold - was wondering where it went or who bought it as it did not appear in the volume traded today. Anybody can shed light on this?



Summary for Heartland HER Holdings Limited


For last disclosure,--


(a) total number held in class: 43,000,000


(b) total in class: 463,266,592


(c) total percentage held in class: 9.282%





For current holding after ceasing to have substantial holding,--


(a) total number held in class: Nil


(b) total in class: 466,946,644


(c) total percentage held in class: 0%

[Xerof]

If you read the explanation carefully, you should be able to determine that Heartland HER Holdings held these in escrow under the lock-up agreement for Seniors. They came out of escrow today, therefore are no longer held by Heartland HER, and have passed to Seniors. So Heartland HER Holdings have declared they no longer have an interest or control over the shares. Doubtless, in due course Seniors will declare a holding of 43m. They have 7 days to make such announcement IMMSMR

percy has the goss on an orderly placement

Can I suggest $1.18 as a disposal price percy????

[percy]

If you read the explanation carefully, you should be able to determine that Heartland HER Holdings held these in escrow under the lock-up agreement for Seniors. They came out of escrow today, therefore are no longer held by Heartland HER, and have passed to Seniors. So Heartland HER Holdings have declared they no longer have an interest or control over the shares. Doubtless, in due course Seniors will declare a holding of 43m. They have 7 days to make such announcement IMMSMR

percy has the goss on an orderly placement

Can I suggest $1.18 as a disposal price percy????

Yes $1.18 may be close.
I think the price will leak out tomorrow.
The sell down means it will not be at $1.30, which I thought would have been possible a month or so ago..!!!!! lol.

[Baa_Baa]

With respect Marilyn M,

No lender wants the assets offered as security, of which few are of any realistic tangible or convertible value anyway. They just want the repayments with interest, preferably forever. They lend money, straight and simple. Recovering a default loan is expensive, but still better than recovering the asset that backs the loan. Easier to right off the loan, if pressed, or recover the asset and sell at book or below to offset the life-of-loan losses. This however is a level above the target of ComCom, though I agree it is caught in the web.

To your other point, the loan sharks to which the legislators appear targeted, they don't even require or insist on asset backing, they require only a promise, to repay the loan. Hence the outrageous margins they demand, and get. Harmoney is in this low-life lender category, targeting people who have little or no option, but are prepared to promise to repay. This is borderline lending ethics. A fancy website doesn't make the practice of lending to the desperate who have no assets to back their commitment to paying exorbitant interest rates any more ethical.

So I put it to anyone who blames the ComCom for incompetence, to suggest a more finely tuned approach to distinguishing between the lenders who insist on asset backing but don't really want to go there, versus the target problem being lenders who prey on the cash poor and turn to the loan sharks, including Harmoney dressed up in fancy website clothing, who willinging lend a few meagre $, of the punters who have money and participate, on the promise of repayment -next payday, or Kaching! penalties and interest over and above the outrageous daily rates already engineered into their largess.

Tough isn't it? Don't be too quick to hammer the legislators, they are not the problem, they are simply trying to find a solution. If we could write a better policy and legislation, maybe we could do better by that than buying the bank, or it's puny lenders who perpetuate the status quo.

BAA



This omnishambles it the confluence of a wish by legislators to get loan sharks and the laws of unintended consequences.

.. snip ..

My solution to this would be to allow loans with a less rule bound approach where the loan is tied to a physical purchase and this purchase secures the loan on a non recourse basis.

Non recourse loans are where the recovery of a loan in default is limited to the item used as security.

.. end snip ..

Boop boop de do
Marilyn

[Baa_Baa]

Annoying when a DRP is at a premium to market. Issue price: $1.32

[Cool Bear]

If you read the explanation carefully, you should be able to determine that Heartland HER Holdings held these in escrow under the lock-up agreement for Seniors. They came out of escrow today, therefore are no longer held by Heartland HER, and have passed to Seniors. So Heartland HER Holdings have declared they no longer have an interest or control over the shares. Doubtless, in due course Seniors will declare a holding of 43m. They have 7 days to make such announcement IMMSMR

percy has the goss on an orderly placement

Can I suggest $1.18 as a disposal price percy????
Thanks Janner.

And $1.18 would be a great buy!

[Cool Bear]

Annoying when a DRP is at a premium to market. Issue price: $1.32
Agree. Difference would have paid for a nice meal. Oh well, sometimes you win, sometime you lose. Hopefully more of the former.

[iceman]

Looks like only about 27-28% of eligible shares chose the DRP this time !


Agree. Difference would have paid for a nice meal. Oh well, sometimes you win, sometime you lose. Hopefully more of the former.

[percy]

Annoying when a DRP is at a premium to market. Issue price: $1.32

Did not look too flash last time either.
But ended up well for us.
Can only hope in 6 months [or less] time we are ahead again!!!
With the wife not taking DRP it softens the blow a bit.!

[Harvey Specter]

Annoying when a DRP is at a premium to market. Issue price: $1.32happened last time too. All was forgiven as it continued to rise after a short lull.

[Beagle]

I look at the DRP as compulsory savings. I don't need the dividend to live on so would probably have spent it on some spurious item so by the saving scheme benefit of the DRP scheme I'm actually miles ahead...and in case anyone was wondering that's what us bean counters call creative accounting :lol:

[percy]

I look at the DRP as compulsory savings. I don't need the dividend to live on so would probably have spent it on some spurious item so by the saving scheme benefit of the DRP scheme I'm actually miles ahead...and in case anyone was wondering that's what us bean counters call creative accounting :lol:

YEAH RIGHT!! lol.

[tim23]

Is there a discount on the shares issued under DRP?

[Harvey Specter]

Is there a discount on the shares issued under DRP?I think it was set at 1% below the 5 day VWAP.

[dingoNZ]

I think it was set at 1% below the 5 day VWAP.


Correct - they worked it out to be $1.32

[percy]

Well the wife's dividend is in OUR account.!!!

[couta1]

Well the wife's dividend is in OUR account.!!!
Mines in MY account.

[Beagle]

Well the wife's dividend is in OUR account.!!!

For how long :lol: Happy Easter shopping.

[winner69]

For how long :lol: Happy Easter shopping.

Garden Centres are open tomorrow

[percy]

Will this be of any assistance selling HER products in Oz?

http://www.businessspectator.com.au/article/2015/4/1/australian-news/ageing-population-calls-more-reverse-mortgages
Thanks for the link.
I am sure it will help HER sales in Oz.

[janner]

Well the wife's dividend is in OUR account.!!!

Damned hard to find a well trained woman these days perc .. :-))))

[Xerof]

Originally Posted by Xerof If you read the explanation carefully, you should be able to determine that Heartland HER Holdings held these in escrow under the lock-up agreement for Seniors. They came out of escrow today, therefore are no longer held by Heartland HER, and have passed to Seniors. So Heartland HER Holdings have declared they no longer have an interest or control over the shares. Doubtless, in due course Seniors will declare a holding of 43m. They have 7 days to make such announcement IMMSMR


percy has the goss on an orderly placement


Can I suggest $1.18 as a disposal price percy????


Originally posted by Cool Bear Thanks Janner.


And $1.18 would be a great buy!

Despite any rumours to the contrary, Janner is not Xerof, and to completely dispel any further rumours, Xerof is not Janner (although I think we share similar musical tastes/genres, and are therefore probably about the same age)

:D:D:D

[janner]

Despite any rumours to the contrary, Janner is not Xerof, and to completely dispel any further rumours, Xerof is not Janner (although I think we share similar musical tastes/genres, and are therefore probably about the same age)
:D:D:D


Buy the rumour !!!.. Sell the fact..

Not much profit being offered on this one.

Which ever way you want to play it :-))

FYI.. I am listening to Itzak Perlman at present.

[Xerof]

Me: Billy Swan's version of 'don't be cruel'

[Under Surveillance]

FYI.. I am listening to Itzak Perlman at present.

He's a nonentity, for Heartland-style value you should listen to his second cousin Itzhak.

[janner]

He's a nonentity, for Heartland-style value you should listen to his second cousin Itzhak.

Oooops.. I stand corrected..

I am not a good reader..

Just an appreciative Listener .. :-))

[winner69]

Billy Bragg's album Workers Playtime

Good track is Waiting for the Great Leap Forward

[janner]

Oooops.. I stand corrected..

I am not a good reader..

Just an appreciative Listener .. :-))

Could have said Isaac !!..

[janner]

Me: Billy Swan's version of 'don't be cruel'

Obviously how you think of your broker :-)))

[janner]

To more serious matters..

As said when the really large jump in share price came..

I expected it to stall..

With the overhang always there.

That is out of the way..

Still think it will Hover..

Long term ?? Try and find better..

Short term.. There are better opportunities IMHO..

Disc. Holding.. ( Well enough positioned ) Not buying..

[Cool Bear]

Despite any rumours to the contrary, Janner is not Xerof, and to completely dispel any further rumours, Xerof is not Janner (although I think we share similar musical tastes/genres, and are therefore probably about the same age)

:D:D:D
Ooops! sorry Xerof

and Janner too!

my bad
regards
Cool Bear

[percy]

Ooops! sorry Xerof

and Janner too!

my bad
regards
Cool Bear

I did not want to say too much at the time,but I knew you were asking for trouble with this Zumba business you are into!!!!
Rocks the brain,gives early stages of dementia.First stage is not knowing a Xerof from a Janner.!!!
You can redeem your wicked ways by buying me a beer at our next get together.!!! lol.

[Cool Bear]

I did not want to say too much at the time,but I knew you were asking for trouble with this Zumba business you are into!!!!
Rocks the brain,gives early stages of dementia.First stage is not knowing a Xerof from a Janner.!!!
You can redeem your wicked ways by buying me a beer at our next get together.!!! lol.
will do, if the meet does not clash with Zumba. must have one's priority right.

[janner]

will do, if the meet does not clash with Zumba. must have one's priority right.

The way the market is at present.

The thought of all those Boobs going up and down, could be preferable ..

[Snow Leopard]

Spent some of the recent dividend cash from assorted companies on a few more HNZ shares.
I am getting seriously overweight*

Best Wishes
Paper Tiger

*and yes, I have a lot of HNZ shares too.

[Master98]

Spent some of the recent dividend cash from assorted companies on a few more HNZ shares.
I am getting seriously overweight*

Best Wishes
Paper Tiger

*and yes, I have a lot of HNZ shares too.
I spent all my cash dividend to assist to buy a 2015 audi a4 replaced my 2008 a4 3.o tdi:)

[Snow Leopard]

Spent some of the recent dividend cash from assorted companies on a few more HNZ shares....


I spent all my cash dividend to assist to buy a 2015 audi a4 replaced my 2008 a4 3.o tdi:)

I prefer to buy assets (such as overseas travel) :t_up:.

Best Wishes
Paper Tiger

[Baa_Baa]

I sold all of my HNZ today for a tidy short term profit. Having read back through my recent posts, I realise that I do have a conflict and would rather not be owning a small bank working on fringe products, for the meantime, perhaps not even major banks but we'll see about that in due course. Ethics and investing is loaded with dilemma. I'm happy to take their 4.5% on call deposit rate though, I can't see why not. HNZ has had a nice run though they have yet to post successes from their various edgier investments and seem happy to go to riskier places where larger banks are equally happy to avoid. All the best to holders and accumulators.

BAA

[Master98]

I prefer to buy assets (such as overseas travel) :t_up:.

Best Wishes
Paper Tiger

lol, I prefer to buy good life;)

[Jantar]

I prefer to buy assets (such as overseas travel) :t_up:.

Best Wishes
Paper Tiger

Strange that. I have just booked a trip to Prague in June. :t_up:

[noodles]

Overhang gone as HER vendor sell out at 1.27. Great result
https://www.nzx.com/companies/HNZ/announcements/262903

Quadrant Private Equity the buyer. Interesting. Any speculation of what their intentions are?

[vorno]

HNZ overhang gone as HER vendor sell out at 1.27. Great result
https://www.nzx.com/companies/HNZ/announcements/262903

How will an odd 10% move affect HNZ?

[percy]

HNZ overhang gone as HER vendor sell out at 1.27. Great result
https://www.nzx.com/companies/HNZ/announcements/262903

Thanks for the link.
Yes great result,quick and easy!!!
And at $1.27 per share!!!

[noodles]

How will an odd 10% move affect HNZ?
It does't affect the business, just the price. The vendors of the HER business had an escrow so that couldn't sell their shares until April 1. They had flagged that they were going to sell. I think the recent price weakness was partly due to this happening because big buyers were holding off hoping to get an allocation at a discounted price. Now this overhang is gone, those big buyers will need to re-enter the market,

[dingoNZ]

It does't affect the business, just the price. The vendors of the HER business had an escrow so that couldn't sell their shares until April 1. They had flagged that they were going to sell. I think the recent price weakness was partly due to this happening because big buyers were holding off hoping to get an allocation at a discounted price. Now this overhang is gone, those big buyers will need to re-enter the market,


I agree with this, but think it may take a month or so to get back up, happy to wait patiently however.

[vorno]

I agree with this, but think it may take a month or so to get back up, happy to wait patiently however.

Possibly a good time to top-in for some then?!

[Beagle]

Nice result. Many of you will be aware that Quadrant are pretty active shareholders and are in to make a buck. They had that sizeable stake they bought in SUM quite cheap, subsequently sold and did handsomely well.
Excellent result to get this very sizeable overhang done and dusted at $1.27. SP looks like a one-way bet from here :t_up:

[winner69]

Good news

Quadrant like winning and generally want more than steady returns. The good news is that they will drive Heartland harder than what it is now. With Quadrant on board I am more confident of my forecasts (the ones you guys think are too bullish). Quadrant will not sit back with steady as she goes attitude.

Overhang gone? Maybe not as Quadrant do exit investments on a regular basis. One thing though they don't usually stuff the price when they o exit.

Go Quadrant, rev Heartland management up. Now you have see the potential make sure it happens.

[iceman]

Agree with that. Great to see Quadrant take a sizeable holding. They will keep pressure on Jeff to continue reaching the goals and possibly push for the goals to be a bit more bullish. I regard Quadrant buying in as a great vote of confidence in HNZ's already announced step change towards more bullish growth.


Good news

Quadrant like winning and generally want more than steady returns. The good news is that they will drive Heartland harder than what it is now. With Quadrant on board I am more confident of my forecasts (the ones you guys think are too bullish). Quadrant will not sit back with steady as she goes attitude.

Overhang gone? Maybe not as Quadrant do exit investments on a regular basis. One thing though they don't usually stuff the price when they o exit.

Go Quadrant, rev Heartland management up. Now you have see the potential make sure it happens.

[Beagle]

Bought more at $1.29. I'm very bullish !!

[winner69]

Bought more at $1.29. I'm very bullish !!

So you should be mate now Jeff has got a shareholder who will make the business work harder instead of just coasting along

Hope Quadrant already on the case and have the big stick out

[winner69]

Didn't Quadrant own most of Seniors when they sold out to Heartland?

Made heaps on that deal ..... and now coming back for more. I like it

[Beagle]

Free lunch on offer at $1.29...best one way bet on the NZX by miles. All those insto's that missed out on a placement will be annoyed and have to buy on market.

[Snow Leopard]

Didn't Quadrant own most of Seniors when they sold out to Heartland?

Made heaps on that deal ..... and now coming back for more. I like it

I notice the terminology 'in specie distribution' in the announcements.
I am just wondering what does that mean here?

Best Wishes
Paper Tiger