Thanks Bob
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Having skin in the game (being an ANZ shareholder) gives a strong incentive to check out the facts. So I have done just that.
Loan Category ANZ Loan Book FY2015 (gross) ANZ Loan Book FY2015 (%ge) ANZ 'Overseas' Loan Book FY2015 (gross) ANZ 'Overseas' Loan Book FY2015 (%ge) Agriculture, Forestry, Fishing and Mining $39,610m 4.7% $5,965m 3.2% Business and Property Services $51,000m 6.1% $6,969m 3.8% Construction $7,609m 0.9% $767m 0.4% Entertainment, Leisure and Tourism $11,797m 1.4% $1,438m 0.8% Finance and insurance $230,710m 27.5% $98,337m 53.2% Government and Local Authority $52,524 6.2% $8.854m 4.8% Manufacturing $34,432m 4.1% $20,332m 11.0% Personal lending $330,925m 39.5% $13,246m 7.2% Electricity, Gas and Water Supplies $9,795m 1.2% $3,774m 2.0% Retail & Wholesale trade $38,528m 4.6% $15,460m 8.4% Transport and storage $14,783m 1.8% $4,984m 2.7% Other $16,455m 2.0% $4,476m 2.4% Total $838,248m 100% $184,602m 100%
The ANZ loan exposure to Asian markets is therefore:
$184,602m/$838,248m = 22.0%
By way of comparison the equivalent figure for Westpac, who do not have a specific push into Asia is just 3%. So the facts back up your suggestion Macduffy.
Now moving onto Rogers point, ANZ as an Australian entity does not disclose a separate exposure for Agriculture. Agriculture loans are lumped in with Forestry Fishing and Mining. The above figure in the table is 4.7%. As a reference the equivalent figure for Westpac (who claim to be underweight mining) is only 2.9%. So ANZ has nearly twice the exposure to Agriculture, Forestry Fishing and Mining as Westpac does. This means that Roger is probably correct as well.
In this instance, with both Macduffy and Roger likely being correct in their views, any mark down in the value of ANZ is probably a result of pressure from both angles.
SNOOPY
Thinking of switching from these to the ordinary shares - anyone else done this or considering?
Great opportunity to load up on this bond if you believe no big sell off in global markets. Current sellers showing a bit of desperation below 102 for a bond yielding 7.2% in an ever decreasing interest rate environment.
No posts this bond for a year-but-thought should note ANZ calling ANBHA $835m 18 April 2018. So ANBHB Optional Exchange Date is May 2020 which allows for the bond to be repaid or converted to ordinary shares. What do posters think? Will ANZ follow the example of the ANBHA bond. Of course the behaviour of interest rates can affect the outcome.
Anyone still following /holding/looking at these? If Optional exc date is may 20 exchange for shares I guess wouldn't be bad? Current SP is 19.58 (3years ago was 35 ..) cash out ok I suppose is ok. Thoughts?
They may offer a lower rate at the reset...but with whats going on who knows
Would you recover the brokerage buying fee with such a small time to maturity? ANBHB seems to be trading at very near to par. Existing Shareholders wouldn't like it if these bonds converted to shares. Good for ANBHB holders to get some ANZ shares at a discounted price, if such a conversion occurs. Bondholders would get ANZ shares at a very good price, but other shareholders would probably have a similar buying opportunity as the market price sank towards the bond conversion price. Have ANZ articulated the need to raise more capital outside of their commitment to retain more earnings?
SNOOPY