Bank stocks

[percy]

'Scuse my ignorance Percy, but while I get the point you are making, when you talk 'equity ratios' and then detail percentages..... I struggle.

Could you please provide a source for your info' and/or perhaps more details on the debt:equity ratios or bank leverage positions you are basing your figures on? Thanks.

FWIW here is a link to RBNZ's May 2020 Financial stability report

Equity ratio Your house is worth $500,000,you owe the bank $400,000 your equity ratio is 20% $100,000 divided by $500,000.If you owe the bank $450,000 your equity ratio is 10% ie $50,000
Equity ratio.12%For every $12 dollars of equity banks lend $100.
Equity ratio 15%.For every 415 dollars of equity banks lend $100.
https://www.google.co.nz/url?sa=t&rc...3l6XHGxmXHLoFq
I remember GFC to well.
Pyne Gould Corp lost [I can't remember the exact amount] between 20% and 30% of their loan book on property developments.Wiped out [shareholders funds] or total equity.Should the property market and general lending go pear shape. we could see banks losing their capital,forcing shareholders to front up with more capital.So equity ratios between 12.9% and 15% do not leave a great margin of safety.Retail,tourism and other sectors could cause a ripple affect.

[winner69]

Leftie ....percy probably got his numbers here

Another rbnz thingie

https://bankdashboard.rbnz.govt.nz/summary

Heartland stand out on the non-performing loans chart ...sort of says when you look at returns charts Heartland takes more risk for greater returns

[Leftfield]

Thanks Percy and Winner - much appreciated (every day I learn.)

The comparative bank profitability chart on Winners link makes HBH look ok, Snoopy will be happy.

[percy]

You will note both my link and W69's link were to the same Dashboard .
Note the Dashboard date was 31st March.
The sh+t has not started to hit the fan.Do not know when it will,but it will,and it will be ongoing.
I still do not think we will see any clarity until late next year.
Some businesses will wait to see how Christmas goes,then they will wait for the end of their financial year,then they will wait to see how their accounts look.Just pushing the growing train wreck further down the track.

[Brain]

It seems to be horse sense to stay well clear of the banking sector - far to many unknowns, these guys will have to run hard just to stay in the same place.

[winner69]

It seems to be horse sense to stay well clear of the banking sector - far to many unknowns, these guys will have to run hard just to stay in the same place.

...but Heartland will be a good buy at around 60 cents

[Waltzing]

Buy gold and pray?

still looking to return to europe in 2022.

https://www.cnbc.com/2020/08/15/viru...sk-orders.html

virus flare ups in europe.

[Scrunch]

Warren Buffett's Berkshire Hathaway Inc said on Friday it has sold shares of some of the largest US banks, slashing its stakes in Wells Fargo & Co and JPMorgan Chase & Co and exiting an investment in Goldman Sachs Group .

A lot of the news value of this depends on the sale price and the context of other banking stocks held. Most of the Goldman Sachs holding was disclosed as sold (84%) in the Q1 regulatory filing with news articles reporting it on 16 May 2020 and what was left was for Berkshire a tiny holding - 1.9m shares at circa $200 each is only $400m and under 1% of Goldman Sach's stock.

What is as interesting is that Buffet didn't file a change in share holding for the 925,008,006 shares held in Bank of America. With Bank of America having a $26/share price this holding is worth $24 billion. And as per the article below, has been adding to this already large shareholding and is now up to 11.9% of the company.
https://www.gurufocus.com/guru/warre...tt/stock-picks

https://www.marketscreener.com/BANK-...tock-31062923/

[Snoopy]

Warren Buffett's Berkshire Hathaway Inc said on Friday it has sold shares of some of the largest US banks, slashing its stakes in Wells Fargo & Co and JPMorgan Chase & Co and exiting an investment in Goldman Sachs Group .

True. But Buffett also increased his shareholding in Bank of America

https://www.marketscreener.com/busin...cks--31122862/

So Buffett isn't pulling back from all bank stocks.

SNOOPY

[Brain]

...but Heartland will be a good buy at around 60 cents

At that price I would show some interest and my guess is that it is more likely that Heartland would trade at 60c than $1.40