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Thread: Mtfhc

  1. #21
    ShareTrader Legend Beagle's Avatar
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    Thanks for clarifying the situation Noodles. Honestly...8.5% in my view is woefully inadequate for this type of perpetual security issued on those terms.
    Another classic Forsyth Barr where they really "looked after" their clients...ranks almost up there with Feltex, Credit Sails and their abhorrent involvement with SCF.
    Last edited by Beagle; 08-01-2015 at 12:44 PM.

  2. #22
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    Hard to price these... No call date/redemption date. How can you price them without knowing when principle will be returned? You would expect some signal to market on redemption, even with perpetuals.

    All I can see in the terms is that they can chose to redeem with 30 days notice (but why would they?), or if they go into liquidation (not ideal).

    Agree with Roger, massively overpriced. I have owned in the past when all the spreads blew out on this complex stuff. Have long since sold as everything has shortened up.

    This quote comes to mind - “More money has been lost reaching for yield than at the point of a gun.”

  3. #23
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    Yes the risks out way the rewards.

  4. #24
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    Quite a jump,8.6% today to 76c today re a 1 year high on good vol; no idea why.

  5. #25
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    Quote Originally Posted by Joshuatree View Post
    Quite a jump,8.6% today to 76c today re a 1 year high on good vol; no idea why.
    Local broker at Hamilton Hindin Greene in Christchurch has picked up on what we were up to a year ago.!
    Read my original post.

  6. #26
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    Cool thanks percy.Our fave stock heartland causing the rerate, at least partly a win /win. Hope it goes to $1 as noodles suggests

  7. #27
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    Quote Originally Posted by Joshuatree View Post
    Hope it goes to $1 as noodles suggests
    Why would it be redeemed at face value rather than just bought on market?

  8. #28
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    Quote Originally Posted by Harvey Specter View Post
    Why would it be redeemed at face value rather than just bought on market?
    Noodle's post #7, and my post #8 on this thread,may explain how we thought at the time.

  9. #29
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    It took the High court circa 5 months to hand down their ruling on this matter.

    If we assume it takes the Supreme court a similar amount of time then we won't expect a final ruling until 5 months after November 2015, somewhere around March 2016 and then the negotiations and shenanigans between HNZ and MTF's board start. Remember MTF's constitution precludes any shareholder holding over 10% without the board's approval and such approval is unlikely to be forthcoming unless HNZ's offer is truly compelling in which case the reticent board members despite knowing they'll be out of a lucrative job will know they have no other legal alternative than to recommend acceptance.

    MTF don't seem all that open to HNZ's approaches and even if HNZ finally get control of the company unless anyone can point to a specific clause in these perpetual notes to the effect of compelling HNZ to buy them out in a takeover situation then I see no reason why HNZ would as these perpetual notes would rank as Basil 3 compliant capital under the Reserve Bank's requirements.

    You can't raise Basil 3 capital at circa 5% and as these are perpetual they would form a sweet and cheap funding source for HNZ....in fact the mere existence of these notes and terms of issue thereof is probably one of the most attractive features of MTF.

    The odds on a capital repayment would appear to be very slim IMHO.
    Last edited by Beagle; 15-10-2015 at 07:20 PM.

  10. #30
    CEO Butch Analytics Ltd winner69's Avatar
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    roger, probably in here somewhere. Your homework!

    http://www.mtf.co.nz/investor/pdfs/MTFProspectus.pdf

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

  11. #31
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    Perpetual: The Perpetual Preference Shares have no fixed term and will remain in existence unless and until they are redeemed or repurchased for cash and cancelled (unless held as treasury stock in accordance with paragraph 1.24 of the terms of the Perpetual Preference Shares) or MTF goes into liquidation. Perpetual Preference Shareholders have no right to require redemption by MTF.

    That's all you need to know right there. Probably one of the main attraction of MTF to another party is this ultra cheap source of basil 3 compliant capital funding as I can't see from the most recent half yearly results or outlook commentary there's a heck of a lot of compelling reasons as a stand alone acquisition. Probably the other main attraction is synergy benefits expanded product range although it could be easily argued that the acquirer could fill out their product offer themselves.

    I can;t see any compelling reason to own these perpetual pref shares IMO. Current yield is ~5/ 0.76 = 6.58%...that would engender nothing other than a big yawn from me.
    Last edited by Beagle; 16-10-2015 at 10:53 AM.

  12. #32
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    I'm with Roger on this. There is no way they will be redeemed at face value. If anyone did want to cancel them, they would buy on market and cancel, and take the huge capital gain inhouse rather than to the speculators. IFT is doing the same having recently purchased a few on market (at the large discount) and cancelling.

  13. #33
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    6.58% plus the 8% increase in value of my units = 14.58% ,YAWN ....def one of the lower returns in my portfolio nothing to get excited about thats for sure.

  14. #34
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    Quote Originally Posted by Joshuatree View Post
    6.58% plus the 8% increase in value of my units = 14.58% ,YAWN ....def one of the lower returns in my portfolio nothing to get excited about thats for sure.
    Nice for you but to imply that anyone buying at 76 cents could achieve a similar capital gain is drawing a long bow in my opinion.

  15. #35
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    No implication; adding up my personal gains and hopeful of more. Unlike you promoting the hell out of AIR @$2.90; with all that insane irrational exuberance over 100's of posts.Any way looks like buyers then close to breaking even.

  16. #36
    ShareTrader Legend Beagle's Avatar
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    Really quite unnecessary for you to take such an argumentative approach and very disingenuous to pick the top.
    Have you checked the AIR thread lately to see how many people have been most appreciative of my analysis and advice, many of whom bough in the low to mid $2 range and are enjoying high fully imputed dividends at a rate far better than this investment.
    Sorry your stock is down 1.3% today with weak and much lower bidding and is so illiquid...but if you buy dogs you have to expect fleas
    Last edited by Beagle; 16-10-2015 at 05:51 PM.

  17. #37
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    So sorry i wasn't ramping AIR at the top I don't need to ramp anything I'm in, up or ramp anything I'm out of ,down. I don't need to influence anyone; or be right; i don't need followers; I feel fine as i am. I don't worry about daily movements.Im enjoying an a new high point in my portfolio value; I enjoy a forum to share in equally without narcissism, one upmanship, competitiveness, ego, overlords, etcetc.
    Its been a good week for MTF ; I'm happy about that.. Been a great month.The weather has been beautiful too and I'm not missing my Gallbladder either.Looking forwards to the big game this weekend.
    Last edited by Joshuatree; 17-10-2015 at 08:50 AM.

  18. #38
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    Quote Originally Posted by Roger View Post
    Probably one of the main attraction of MTF to another party is this ultra cheap source of basil 3 compliant capital funding.
    Here an RB document summarising its position on Basil III: http://www.rbnz.govt.nz/research_and...015may78-5.pdf
    Basil III compliance is an attribute of a bank not any particular security but I guess Roger means to imply that MTFHC is a qualifying AT1 security in RB parlance. However it is pretty clear to me that MTFHC has no loss absorbency provision satisfying Basil III capital requirements and therefore does not qualify for either Tier 1 or Tier 2. So maybe not so cheap. I think such securities are recognised for existing banks as an interim measure until 2018 -2019 but whether they would be recognised after an acquisition such as HNZ purchasing MTF is a fairly moot point. I don't know what HNZ's current Basil III capital ratio is but I would be surprised if it was sufficient to absorb such an acquisition without further capital.

    Disc I hold both HNZ and MTFHC.

  19. #39
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    Whats a happening with MTFHC, Redemption?, Anyone have any ideas price been on the up .Still hold a few. Price started lifting from $60 early may now at $67.90
    Last edited by Joshuatree; 22-07-2019 at 04:37 PM.

  20. #40
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    Last reset in oct 2018 @ 4.38%.Price up nearly 8% in 1 year. Payment date 31 July.
    Last edited by Joshuatree; 22-07-2019 at 09:35 PM.

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