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  1. #8091
    Speedy Az winner69's Avatar
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    Quote Originally Posted by Hectorplains View Post
    So when dairy prices were in freefall that was not an issue for Heartland but now rising ones are a 'significant' positive.

    Okay?
    Too right

    In theirown words growth in dairy lending remains on the agenda - "Continued low dairy prices dictate a cautious approach to new lending, but remain open to new customers and supportive of existing customer"

    Better dairy prices good for Heartland
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  2. #8092
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    Quote Originally Posted by Hectorplains View Post
    So when dairy prices were in freefall that was not an issue for Heartland but now rising ones are a 'significant' positive.

    Okay?
    Well the difference was, in my view, that the share price fell (in a reasonably significant way) when dairy prices fell, now they have dramatically risen, while HBL has barely moved
    (just my view)

  3. #8093
    percy
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    The main reason Heartland Bank share price fell so much because of dairying was because the market thought a] Heartland had a huge exposure to dairying,and b] the borrowers would default.
    Neither were correct.
    Whether some people see things that way could affect Heartland Bank's share price,yet analysts from the major broking houses have never seem dairying as a "major" issue to Heartland Bank.They correctly saw HBL had low exposure to dairying,and the loans had good security.We must remember HBL brought PGW's rural loan book,which was mainly sheep and beef farmers.

  4. #8094
    Divorced from logic Hectorplains's Avatar
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    Quote Originally Posted by percy View Post
    The main reason Heartland Bank share price fell so much because of dairying was because the market thought a] Heartland had a huge exposure to dairying,and b] the borrowers would default.
    Neither were correct.
    Whether some people see things that way could affect Heartland Bank's share price,yet analysts from the major broking houses have never seem dairying as a "major" issue to Heartland Bank.They correctly saw HBL had low exposure to dairying,and the loans had good security.We must remember HBL brought PGW's rural loan book,which was mainly sheep and beef farmers.
    Which means that the correction in dairy prices will have little immediate impact on the state of the loan book, it does offer some potential going forward for loans. I doubt that potential warrants a significant share price rise?

  5. #8095
    percy
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    Quote Originally Posted by Hectorplains View Post
    Which means that the correction in dairy prices will have little immediate impact on the state of the loan book, it does offer some potential going forward for loans. I doubt that potential warrants a significant share price rise?
    I concur......lol.

  6. #8096
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    Quote Originally Posted by Hectorplains View Post
    Which means that the correction in dairy prices will have little immediate impact on the state of the loan book, it does offer some potential going forward for loans. I doubt that potential warrants a significant share price rise?
    Correct, probably doesn't warrant a significant share price rise, but for some unkown reason to me (and percy) it did seem to warrant a significan't share price drop (in my view)
    ...I'd like to see this 'reinstated' accordingly... after the DRP
    Last edited by trader_jackson; 08-09-2016 at 08:10 PM.

  7. #8097
    Speedy Az winner69's Avatar
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    Quote Originally Posted by trader_jackson View Post
    Well the difference was, in my view, that the share price fell (in a reasonably significant way) when dairy prices fell, now they have dramatically risen, while HBL has barely moved
    (just my view)
    Relationship still exists t_j

    HBL share price moving up faster than WMP is - not 'barely moved'

    Interesting but a load of the old proverbial ....unless the populous relate Heartland to farming and as such dairy prices one way or the other have an affect on their profitability

    Other things no doubt in play - like a market exuberance rerating most things upwards whether warranted or not.
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  8. #8098
    Speedy Az winner69's Avatar
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    One advantage of being small - you don't get the same scrutiny as the big banks. But industry behaviour might roll over to Heartland - if there is actually anything dodgy

    http://www.interest.co.nz/rural-news...tification-and

    Love the term forbearance - is that the same as putting off the day you need to face up to reality

    Extract

    "The topic for this year's thematic review is: "Problem loan identification, forbearance and provisioning practices in the dairy sector," the Reserve Bank says.

    "Our objective is to better understand how banks are capturing and measuring dairy sector credit risk and how this translates into provisioning and forbearance practices. The review is limited to the industry's five largest dairy lenders [ANZ, ASB, BNZ, Rabobank and Westpac] and will require the banks to respond to a comprehensive questionnaire and provide supporting data."
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  9. #8099
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    Quote Originally Posted by winner69 View Post

    and will require the banks to respond to a comprehensive questionnaire and provide supporting data."
    Which will be costly to those Banks and not Heartland..

    Disc. Hold..

  10. #8100
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    Quote Originally Posted by winner69 View Post
    One advantage of being small - you don't get the same scrutiny as the big banks. But industry behaviour might roll over to Heartland - if there is actually anything dodgy

    http://www.interest.co.nz/rural-news...tification-and

    Love the term forbearance - is that the same as putting off the day you need to face up to reality

    Extract

    "The topic for this year's thematic review is: "Problem loan identification, forbearance and provisioning practices in the dairy sector," the Reserve Bank says.

    "Our objective is to better understand how banks are capturing and measuring dairy sector credit risk and how this translates into provisioning and forbearance practices. The review is limited to the industry's five largest dairy lenders [ANZ, ASB, BNZ, Rabobank and Westpac] and will require the banks to respond to a comprehensive questionnaire and provide supporting data."
    The problem lies in that prices have gone up as a consequence of cut back on volumes...revenue is still a concern....

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