When the going gets tough, the tough suspend trading. Portugal has halted trade in Banco Espirito Santo with the stock off 17.2% on the session and 54% over the last month. At issue are financial troubles for the bank's privately-owned holding company, Espirito Santo International. Its accounts are currently under review by an external auditor who has identified irregularities and concluded the company "is in serious financial condition." Santander (SAN -5.8%), UBS (UBS -1.8%), Deutsche Bank (DB -3.1%), Bank of Ireland (IRE -5.6%), Credit Suisse (CS -2.8%), ING (ING -3.2%), BBVA (BBVA -3.1%). U.K. banks: Barclays (BCS -3.8%), RBS (RBS -1.9%), HSBC (HSBC -1.9%), Lloyds (LYG -2%). European financial sector ETF: EUFN -2.4%.
IRE now 3% from parity. This helps buyers who like having a dollar exposure. Let's see if this increases the interest stateside which could really help this share. The previous double digit premium would have kept certain US institutions that can only take $ exposure away of which there are many & which are big by Irish standards. Now BKir mgmt need to ensure this doesnt go materially out of line again by ensuring the arbitragers can do their work unhindered.
i agree a sp at 50% of bv would be suggesting the possibility of default/restructuring.....not on the cards for a bank now profitable and building bv, albeit slowly. That's fantasy
BOI's exposure to Spain & Portugal is a 1bn euros all covered bonds so even if Espirito goes this in itself shouldn't be an issue as the covered bonds are designed to not be related to the originator's credit. Espirito is Portugal's leading bank and wont be let go, so worst case would be nationalisation. so its more an equity risk than counterparty risk.
The days of getting Bkir at 50% of bv are well & truly gone
Every time she drops, just buy more, at some point in the future this little goldmine will pay you back, not many around like this one, it will pay you back in the future, you might have to wait some time, it will come right though.
when you put forward a view that suggest a share may drop more than 50% from here to a level not seen in nearly two years ( when the bank was still in danger of outright nationalisation ) , you best not be too surprised if some prick holes in your thesis
it would take the threat of outright default for the SP to get back to 9 or 10 cents , with that line , you completely discredit your entire arguement
id be astonished if it got close to 15 cents , 19 is rock bottom as it would be a 50% drop from the yearly high , that wont happen unless stress tests are failed , we do have work to do under 24 cents however now that we entered that territory
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