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  1. #11701
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    Quote Originally Posted by horus1 View Post
    That would explain the shareprice weakness. Makes the new set up a good move
    Might be able to reallocate / transfer some of equity allocated to the non-banking group to the banking group to shore up the banking group (or some other financial engineering) — sneaky eh
    “Just consider that maybe the probability of you being wrong is higher than you think.”

  2. #11702
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    Quote Originally Posted by winner69 View Post
    Might be able to reallocate / transfer some of equity allocated to the non-banking group to the banking group to shore up the banking group (or some other financial engineering) — sneaky eh
    More like easy peasy.
    Could even alter the ratio on a daily basis,making the most of their capital.
    Clever CEO our Jeff.
    "What capital ratio do you want today Adrian"?
    Last edited by percy; 15-12-2018 at 12:00 PM.

  3. #11703
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    Quote Originally Posted by winner69 View Post
    I’ll get Snoopy to assess how much more capital Heartland Bank might need to reach new ‘rules’
    Something to look forward to
    om mani peme hum

  4. #11704
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    It’s going to take years before anything needs to be done ..that 15% mentioned is by 2025 or something

    No worries
    “Just consider that maybe the probability of you being wrong is higher than you think.”

  5. #11705
    percy
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    Quote Originally Posted by winner69 View Post
    It’s going to take years before anything needs to be done ..that 15% mentioned is by 2025 or something

    No worries
    Never has been.

  6. #11706
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    Quote Originally Posted by percy View Post
    Never has been.
    From a regulatory POV I agree ....but from a prudent / risk POV some would say there are some worries ....the world is too highly leveraged and has become complacent ...like no worries nothing can go wrong
    “Just consider that maybe the probability of you being wrong is higher than you think.”

  7. #11707
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    Quote Originally Posted by percy View Post
    Never has been.
    From a regulatory POV I agree ....but from a prudent / risk POV some would say there are some worries ....the world is too highly leveraged and has become complacent ...like no worries nothing can / will go wrong
    “Just consider that maybe the probability of you being wrong is higher than you think.”

  8. #11708
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    “Just consider that maybe the probability of you being wrong is higher than you think.”

  9. #11709
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    This looks to be the roading equivalent of saying - lets avoid crashes and decrease the speed limit. If we set the open road speed limit at 60 kph, there will be a lot less fatal crashes so let forget 90, 80 and go straight down to 60.

    This would be great at achieving this single objective (assuming adherence to the rules). It would create incredible operational inefficiencies relative to previous settings.

    So if you need up to 60% more capital to do the same lending, if no additional capital is contributed, lending needs to reduce by 37.5%.
    All of this additional capital that is soaked up in the higher "safety" threshold hasn't been made available to residental and commercial customers
    If your lending has to reduce by 37.5%, there would need to be quite an expansion of margins so that this reduced activity level didn't cause profitability to drop
    The more capital that is needed, the harder it is to finance growth.
    Also unless RBNZ were to relax their buffer requirements should banks post losses, banks would need to operate above this new threshold. This potentially means that we could have the strange combination of a severe credit crunch (which is just what RBNZ are trying to avoid) when banks are actually pretty sound on international benchmarks.

    There looks to be some pretty big down-side risks to NZ inc from this decision (if it progresses in its current form).

  10. #11710
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    Of cource its just coincidence that RBNZ want to increase the financial Capital requirements?? ... After they arguably had a decent (negative?) role to play in the capital reserves needed for CBL and the events that followed..

    NZRB hands got burnt.. So best make a much larger buffer do rerisk themselves vs really derisking the banking big 4.. Who by accounts have decent ratios v international benchmarks....

    .. And sigh, I bought decent amount of WBC last week.. Thinking its at its lows and on the up after their Aus AGM and mea culpa seemed well received.

  11. #11711
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    Quote Originally Posted by winner69 View Post
    I’ll get Snoopy to assess how much more capital Heartland Bank might need to reach new ‘rules’
    Quote Originally Posted by winner69 View Post
    It’s going to take years before anything needs to be done ..that 15% mentioned is by 2025 or something

    No worries
    Quote Originally Posted by percy View Post
    Never has been.
    Well the market is looking a little worried, with the share price down to $1.46. But I guess it is just following the general market trend. Nothing to do with having a 'Shortage of Capital'! Hey that last phrase sounds familiar. Where abouts on this thread have I heard it before?

    SNOOPY
    Last edited by Snoopy; 17-12-2018 at 03:37 PM.
    Industry shorthand sees BNZ employees still called 'bankers' but ANZ employees now called 'anchors'. Westpac has opted out of banking industry shorthand...

  12. #11712
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    You heard from the same poster who said Heartland would not get a banking licence.
    You may not have a long memory,but I have.....lol.

  13. #11713
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    https://www.msn.com/en-nz/money/mark...cid=spartandhp

    I would think HGH would be okay with its teir 1 capital ratio already but after the Aussies milking us Kiwi's for years and having low capital ratio's the RBNZ obviously thinks its time for them to sure-up their capital ratio's here and I have no sympathy for them.
    No butts, hold no mutts, (unless they're the furry variety).

  14. #11714
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    Surely this is positive for HGH

  15. #11715
    Trying to get outta here
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    This things broken and I bought more yesterday at $1.45, I'm moving back to my roots next year by getting away from diversification in any meaningful way, every time I've gone beyond holding 3 or 4 stocks I've been skunked.

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