HGH - Heartland Group Holdings

[percy]

The six and a half year jail sentence handed down to Bridgecorp's Robert Roest, may help to focus the attention of a great deal of people who work in the financial services sector in New Zealand.

[janner]

That why roe bad metric for banks .....leverage clouds the issue

But bank execs love it when their huge bonuses tied to roe .....just go out and borrow more and do some risky lending and hey presto roe shoots up ....and bonuses as well

winner.. I am just into the first 60 pages of " The Creature From Jekyl Island ".. A 600 page tome..
Plus a perusal of the Photo's :-)

All is laid bare !!.. You are so correct !!..

[Beagle]

The six and a half year jail sentence handed down to Bridgecorp's Robert Roest, may help to focus the attention of a great deal of people who work in the financial services sector in New Zealand.

He still doesn't even acknowledge he did anything wrong and tried to deflect the responsibility onto investors, can you believe it !!

Does this grossly reckless attitude mean he will still be eligible for parole after serving a third of his sentence ?

It should be 20 years in my view.

[percy]

He still doesn't even acknowledge he did anything wrong and tried to deflect the responsibility onto investors, can you believe it !!

Does this grossly reckless attitude mean he will still be eligible for parole after serving a third of his sentence ?

It should be 20 years in my view.

I think all of us on Sharetrader would agree with you Roger.

[Beagle]

I am currently forecasting returns resulting from P/E expansion of around 4.4% p.a. over the next three years plus EPS growth of around 7.6%, plus dividend yield of 7.4% amounting to a total return forecast of 19.4% p.a. over the next three years.

As ROE improves, HNZ will start to trade at higher multiples to book value. An ROE of 12% in three years time might see HNZ at 1.4x book value for example.

discl: long HNZ

Good common sense and a realistic expectation that should be realised unless we get another major exogenous shock to the banking system in which case small banks like this are unfortunatly quite vulnerable. I'm sorry to say I forsee a moderate chance of a major international financial shock in the years ahead, which measured against your expected returns translates to this investment being only modestly attractive in my opinion...and that's leaving all my finance company baggage out of it. Reserve bank oversight adds another level of checks and balances but i'm well and truly over relying on regulatory oversight to protect my investments.
Just look at how "useful" the Trustees and auditors were with the finance company collapses and how toothless the Securities Commission turned out to be. Standard and Poors are very risk averse after their appalling fiasco with the AAA rating on CDO's and I predict they will be incredibly slow to re-rate this company to BBB where it really needs to be to get what I consider to be genuine bank status in the eyes of the international credit rating agencies.

I hope for everyone's sake we don't have a GFC MK2, not that I'm totally convinced we're out of the first one yet. Just wanted to add a bit of dissenting opinion for the sake of another point of view.
My view in summary, HNZ seems fairly priced for the expected returns and risks involved.

[percy]

Those of us familiar with HNZ's lending book see Heartland "well positioned" to ride out any "banking shock".HNZ are not heavily into household mortgage loans.Most loans are to the productive sector,motor vechicle finance,and rural stock and seasonal loans.
HNZ's loans are mainly of a short term,which adds to their margin of safety.Not reliant on wholesale or overseas funding is a further strength.

[Snow Leopard]

Those of us familiar with HNZ's lending book see Heartland "well positioned" to ride out any "banking shock".HNZ are not heavily into household mortgage loans.Most loans are to the productive sector,motor vechicle finance,and rural stock and seasonal loans.
HNZ's loans are mainly of a short term,which adds to their margin of safety.Not reliant on wholesale or overseas funding is a further strength.

This does not make it immune to problems, just that the problems will be different.

Best Wishes
Paper Tiger

Disc:
If I see 'well positioned" one more time...







...I will have seen it again.

[percy]

This does not make it immune to problems, just that the problems will be different.

Best Wishes
Paper Tiger

Disc:
If I see 'well positioned" one more time...







...I will have seen it again.

Makes any potential problems more manageable,and containable.
I reserve my rights.!!! Would "WP' be acceptable?

[vorno]

Makes any potential problems more manageable,and containable.
I reserve my rights.!!! Would "WP' be acceptable?

Well, I suppose Warren Puffett wouldn't mind

[janner]

WARREN WHO ??..

Only Well thought out answers.. Please..