Thanks for the memories:). "Pack my box with five dozen liquor jugs" as well.
And this one for Hobbit fans
”The quick onyx goblin jumps over the lazy dwarf”:
Thanks for the memories:). "Pack my box with five dozen liquor jugs" as well.
And this one for Hobbit fans
”The quick onyx goblin jumps over the lazy dwarf”:
My apologies for the confusion, the distribution from the trust to Turner's has the lowest seniority after the more senior tranches are paid first. The reverse occurs for credit losses as well, any bad debts or impairments are covered by the lowest tranches first i.e. Turner's, then any remainder credit losses beyond that tranche are shared with the next tranche i.e. BNZ. This is why the finance receivables are still reported on the Group's balance sheet as they still retain the substantial risks and rewards of those loans.
The bonds referred to were the TRAHB sub notes of $25m that are held as security over the trust. These, along with other assets, provide that buffer to absorb any potential credit losses before BNZ up to the agreed upon 8% contribution by Turner's.
OK, the fact that Turners are last on the waterfall to get the rewards of the Securitization but first on the waterfall to absorb the losses of the Securitization makes much more sense. Thanks.
In the March 2018 newsletter (p1), Turners state they are looking to extend their securitization facility in the future to $250m.Quote:
The bonds referred to were the TRAHB sub notes of $25m that are held as security over the trust. These, along with other assets, provide that buffer to absorb any potential credit losses before BNZ up to the agreed upon 8% contribution by Turner's.
8% of $250m is $20m.
There are just over $25m of TNRHB bonds outstanding. So there are more than enough bonds to satisfy the Turners Automotive Group Guarantee (amounting to 8% of the securitized loan balance) of the 'Turners Marque Warehouse Trust 1' (the loan securitization entity).
However the quantum of current loans securitised at EOFY2018 balance date has not yet been disclosed. As at the half year it was $117m. So it seems not all of the TNRHA bond capital is required to guarantee the securitised loans.
I had another look at the bond prospectus and found this quote on p21
"The Turners Group’s primary finance activities include the Bank Borrower Finance Companies which rely on borrowers to repay their loans and make interest payments on due date. The Bank Borrower Finance Companies take security over assets to secure most of the loans they make. However if a borrower fails to repay the loan on its due date and the value of the secured asset (if the loan is secured) and/or the amount recovered under any guarantee is insufficient to cover the outstanding payments, the relevant Bank Borrower Finance Company will make a loss on that loan (credit risk). If this occurs in relation to a significant number of loans, Turners may default with its lenders (including Bondholders)."
From what Fox is saying, it seems that as the quantum of securitized loans goes up, so does the quantum of TNRHB bonds tied to supporting those loans. So rather than TNRHB bonds being used as 'general loan capital' to support the wider activity of the group, we are heading for a situation where the TNRHB bonds support securitized car loans only. Thus it appears to me that the underlying risk profile of the TNRHB bonds is changing over time. It does look to me as though they have become riskier over FY2018!
SNOOPY
Given that I am new to this game - can you explain the strategy of listing 39, 57 shares? And maybe you could tell me what broker one would use whereby that is economical viable? Cheers
I see ... it becomes a little clearer. Thanks!
Business bakery now out, i'm guessing the selling pressure will ease off now?
There are 2 announcements for the Business Bakery.
SPH Notice - The Business Bakery L.P.
https://www.nzx.com/announcements/319102
SPH Notice - Baker Investment Trust No 2
https://www.nzx.com/announcements/319105
First one says: Details of the transactions or other events requiring disclosure: In specie transfer of 8,461,723 shares held in TRA by The Business Bakery L.P. to its limited partners
Second one says: In specie distribution of shares in TRA held by The Business Bakery LP to its limited partners, including 2,464,124 shares to the trustees of the Baker Investment Trust No 2
Doesn't look like they're selling their shares on market, but rather transferring of shares around. Who are these limited partners I wonder?
Our friend Mark says NZX going gangbusters
Turners a laggard ...an undernperformer
Possibly a case of just a strong market dragging stocks like Turners up (the rising tide thingie) ...fundamentals don’t deserve much more
Mark Lister (@MarkListerNZ)
8/06/18, 8:49 AM
The NZX 50 is up 3.05% so far this week, with one day to go. If it holds onto those gains this will be the best week since July 2016.