HGH - Heartland Group Holdings

[mouse]

At the AGM some one asked Jeff Greenslade why HNZ were only achieving 4% ROE.He replied that he intended to get the ROE into double didgets.
[Can't remember if he gave a time frame,but don't think it will take too long].
I think SCOTTY posted UDC result,which I think HNZ should be able to match in the not too distant future,ie and I still think the ROE achieved by ANZ and CBA should be HNZ's goal.

What many of us are hoping for is a return of equity! Suggestions please on how long it might take.

[percy]

What many of us are hoping for is a return of equity! Suggestions please on how long it might take.

Beauty of the share market is that you can sell any time you want.If you have paid less than current SP you make a profit, as well as getting your equity back.Should the SP be less than you paid you take a loss and get back what ever equity is left.Each day people are buying and selling,some making a profit,while others make a loss.Should you keep making profits you are making the right decisions.Should you keep making losses I think the sharemarket is not for you.

[mouse]

It is happening now,so enjoy it.!!!!

I am not too badly hit from all this. But NZ, Kiwis, have had to put up with leaking buildings, the collapse of Finance houses, earthquakes, decline of wages. Bankrupt insurance companies. I am pretty surprised there is any cash left in our islands.
Return OF equity is still pretty important.

[percy]

I am not too badly hit from all this. But NZ, Kiwis, have had to put up with leaking buildings, the collapse of Finance houses, earthquakes, decline of wages. Bankrupt insurance companies. I am pretty surprised there is any cash left in our islands.
Return OF equity is still pretty important.

Most companies on NZX have very strong balance sheets and are paying good dividends.I believe the banks are full of money.Steel and Tube placement of approx $90mil was sold down by one broker within 20 minutes.Pent up cash waiting for SOE floats.Kiwi Saver is increasing quickly and looking for investments.Travel overseas,or read articles on overseas and you will realise how lucky to be living in NZ which has rule of law,stable government,and a strong ecomony.Trev "you don't know how lucky you are."

[winner69]

A target ROE of say 14% implies a relatively high degree of leverage ....more than at present ...and sort of says more 'risk' has to be taken on

hnz remuneration policy seems a bit vague ......do you know much about that Percy

Question then - is improved roe part of execs incentive?

[percy]

A target ROE of say 14% implies a relatively high degree of leverage ....more than at present ...and sort of says more 'risk' has to be taken on

hnz remuneration policy seems a bit vague ......do you know much about that Percy

Question then - is improved roe part of execs incentive?

The 14% may be too high a target,but in time we should see the $160mil to $180mil of non core property assets sold,and think they should get good returns from car,truck,machinery,livestock financing etc .If they develope what they are good at, and what they know, risk should not be unreasonable. They are not looking to be everything to everybody,and I expect [or hope] the branch roll out will be slow,therefore overheads charges should be modest.
HNZ remuneration policy,I have not read,so can't comment.[I have never been able to understand one incentive plan. I have always felt they are a transfer of wealth from shareholders to management ,and I have a record of always voting against them]

[kizame]

The 14% may be too high a target,but in time we should see the $160mil to $180mil of non core property assets sold,and think they should get good returns from car,truck,machinery,livestock financing etc .If they develope what they are good at, and what they know, risk should not be unreasonable. They are not looking to be everything to everybody,and I expect [or hope] the branch roll out will be slow,therefore overheads charges should be modest.
HNZ remuneration policy,I have not read,so can't comment.[I have never been able to understand one incentive plan. I have always felt they are a transfer of wealth from shareholders to management ,and I have a record of always voting against them]

Good on you Percy I totally agree,let companies buy those shares on market,and finance employees into them.I think that is a fairer way to do the incentive thing. All these "options issues" are all very well,but that does take equity from investers.

[winner69]

You have convinced me that 14% roe is a reasonable target

If achieved why the heck would you want them to pay divie ......hard for you make that much after tax. ...so let them do it for you

After 5 years equity would be 722 million ..... Keeping that equity ratio everybody is envious of they would have over 7 billion lent out

Good eh ...share price would reflect that ....so don't ask for divies .....please

[percy]

You have convinced me that 14% roe is a reasonable target

If achieved why the heck would you want them to pay divie ......hard for you make that much after tax. ...so let them do it for you

After 5 years equity would be 722 million ..... Keeping that equity ratio everybody is envious of they would have over 7 billion lent out

Good eh ...share price would reflect that ....so don't ask for divies .....please

Makes you realise how quickly and profitabily financial intos can and do grow. Any time the "big" banks have been in trouble and come to shareholders for funds they recover very quickly.I am thinking of Westpac in the early 1990s when it looked at one stage Kerry Packer was going to take them over.!!! I think all the "big" Aussie banks have problem [Aussie] residential loans,which off course HNZ don't have.[Although they have their non core property problem].
History confirms you are better off owning a bank,rather than having money in the bank.

[winner69]

Remuneration policy .... esp around exec incentive and relevant KPIs .... seem to be out of the public domain (confess i didn't look too hard) .... except the committe sees that is tied to enhancing shareholder value .... yippee

Have written to them asking if there are documents outlining such things that investors might be able to see to from an idea of how they are going to enhance shareholder value ..... in other words percy how they are going to transfer wealth from shareholders to themselves