HGH - Heartland Group Holdings

[winner69]

Noodles mentioned maybe OCR go down and lower interest rates will help stretch dairy farmers.

Bagrie from ANZ says a certainty next week, good old Cam (are ally good bloke).

That Herald piece said "Reserve Bank data show that floating-rate loans amounted to 72 per cent of total dairy lending in June 2014, up from 16 per cent in 2008"

That's good then, most dairy farmers (and every one else) will have heaps less interest to pay and the pressure is off. But then they will like all us moan like hell when inflation goes way over 3%

Conversely if interest rates go up life becomes tough for the stretched ones. Say a 1% point increase in rates would lead to roughly 15% more on the interest bill - heck reduced income and much higher outgoings.

Really tough for those 10% who have 33% of sector debt .....bet you they are the highly leveraged ones. (I won't mention farm prices)

Ignore the potential risks not assessing its impact is folly

[percy]

Spot on Percy, you are so so right.


So NPAT will be $47.0m to $47.9m. Nothing more, nothing less. Anything more they haven't really been upfront and telling porkies. So close to the end of the year they already knew the answer within a few bucks.

I think Roger highlighting dairy lending is relevant. He is not saying it might hurt heartland this year but has a genuine concern about the next year or so. Things slowly get worse.

I think taking the associated risks into account is wise. Ignoring the potential risk and not assessing its impact is folly. Your assessment no doubt will differ from Rogers

All lending has associated risks.All banks take some "big hits".Nature of the beast.Over lending in any one sector,often leads to big loses for banks.
What we can learn from the history of the Australian banks,is their capacity to recover very quickly from "big hits".
I will point out again the challenges the Australian banks face;over valued property market,both Aussie and Auckland,mining,manufacturing,and retail, and in NZ their exposure to rural mortgages.Plus the fact they need to improve their capital ratios.Yet they will get over these hurdles quickly.
Heartland will take hits also.Nature of the beast as I have said.
Yet I feel the prospects for NZ banks is a lot better over the next two or three years than for the Australian banks.This is based on the economic forecast for NZ being so much better than the forecast for the Australian banks.Yet some NZ sectors will face challenges,
so I can see where Roger is coming from,yet with such a widespread diversified portfolio HNZ is "well positioned."

[winner69]

...........
In 1991 Westpac had huge loses on commercial property.At one stage it looked like Kerry Packer would take them over at under $4.On Friday they were down to $31.19,so someone who brought in 1991 would be up 732% plus they would have enjoyed lovely dividends.
From 1991 the others were up as follows [does not include dividends] ANZ 917%,CBA 1076% and NAB 671%.

Even the$16 punters fronted up with to shore up Westpac in 2008 not too shabby now either is it

[percy]

Even the$16 punters fronted up with to shore up Westpac in 2008 not too shabby now either is it

Not too shabby at all.!!
I was rather hoping you or Macduff ,would correct me and say it was 1992, when it looked as though Kerry Packer would take over Westpac at under $2. !!! lol.

[winner69]

Not too shabby at all.!!
I was rather hoping you or Macduff ,would correct me and say it was 1992, when it looked as though Kerry Packer would take over Westpac at under $2. !!! lol.

Even I would front up with if heartland needs to boost its balance sheet when the next crisis hits ....at $1

[winner69]

Not too shabby at all.!!
I was rather hoping you or Macduff ,would correct me and say it was 1992, when it looked as though Kerry Packer would take over Westpac at under $2. !!! lol.

http://www.independent.co.uk/news/bu...k-1478651.html

[percy]

Even I would front up with if heartland needs to boost its balance sheet when the next crisis hits ....at $1

Me too.!!!
Then we can say we are "well positioned" to wait for the time we receive a $1 a year dividend.!! Bring it on.! lol.
I keep forgetting the huge dividends the Australian banks have paid over the years,but going back to basics we must remember, "it is better to own a bank,than have money in a bank."

[percy]

http://www.independent.co.uk/news/bu...k-1478651.html

Wonderfull.
Thank you.
I was a year and a $1 out.!!!!
Gee that was fun!!!!!!!!!!!!!!!!
Would love to have a video of Kerry explaining the facts of life to the Westpac board.!!!

[winner69]

I had forgot about Al Dunlap becoming involved .... Chainsaw Al

He had an inglorious ending to his career.

Best insult thrown at him was being voted 6th worst CEO of all time

All these good times even before Rogers time eh Percy ....ha ha

[iceman]

Basically what I've been saying for many weeks now.
http://www.nzherald.co.nz/business/n...ectid=11460713

Not all bad mate. Many cutting back on cattle numbers and costs a bit during the dry season to relieve the cashflow, by taking advantage of high prices at the meatworks http://www.nzherald.co.nz/business/n...ectid=11461065