I've been told from people that work in bank of Ireland,its very busy however they say their customer service is understaffed which need to be improved to maintain customers.compared to aib which is much more efficient,however the figures you presented are excellent read
Had a little time to run over the figures and to be honest I can only see very good numbers. The bank gave so little away in their IMS in November that it's of very little use except for I recurring phrase "in line with expectations".
So if we take it that NIM has most likely stalled or even reversed a little it should still come in at 2.15%..2.18% up from 2.11 in 2014. Loan volumes will most definitely continue to grow both here and in the UK especially but so will repayments and mean over all loan volumes will at best remain static or even fall (exchange rate), 83..84billion. This is one of the figures the markets will react to so if it beats 84 billion so much the better.
Fully loaded CET1 is now the ratio that is most important. It went down to 10.6% in November and surprised everyone. The pension liability was to blame and although it may have repaired itself somewhat there is know way of knowing that. We also don't know if the bank sold any bonds but if they did there is a good chance they made a loss on them. So long as the ratio stays above 10% its not a disaster. Below 10% would take the shine of any other numbers. The bank management themselves have a core aim of over the 10 so we would have to assume they will take all necessary measures to maintain that plus a bit. 10.5% to 11% would a fair result.
Write backs are up to managment but lots of room there. Maybe €200 million?
Impairment charges should be also less at between €250 and €300 million. €540 million in 2014.
The bank should have had a great year in the business over all and as it said "in line with expectations". I can't an underlying profit of less than €1.5 billion and it could easily be €1.8 billion. At a present market cap of 8.5 Billion that would leave this a VERY cheap share price.
If anyone has any different thoughts or if I have missed something please feel free to pick hole in the above figures
.."Perhaps investors were inspired by Jamie Dimon – the boss of Wall Street giant JP Morgan – who has invested £18million of his own fortune in his bank’s shares. The clear message from Wall Street to everyone bailing out of bank stocks is: ‘You’re all wrong.’ Simon is not alone in thinking the banking rout has created a great buying opportunity – although most people will not have pockets quite so extravagantly deep. Fund manager Fidelity appears to be on the same wave length as the Wall Street bruiser. It said it is venturing into stocks caught ‘in the eye of the storm’ of the heavy market sell-off. Paras Anand, head of European equities at Fidelity, said the fund group was eyeing those sectors of the market most heavily hit by the market sell-off for the first time ‘in a long time’. The group has broadly responded to previous market slumps by taking bigger bets on defensive names – those stocks better able to weather economic pressures, such as pharmaceutical and tobacco companies. But Anand said that extremely low valuations in ‘cyclical’ sectors – those which tend to be buffeted around by the prevailing economic conditions – have prompted it to take a closer look. He revealed that the fund group is now eyeing the banking sector with particular interest. ‘The difference between the price on the screen and what we see as being the true fundamental strength of the business has got to such an extreme level,’ he said. We do not have a structurally weak banking sector"....
i can't decide if that was a good week or a bad week. I suppose it was a could have been worse week. At least we finished with a blue arrow.
DB bond buy back gave us a little boost. It is a little worrying that buying there own unsecured debt was considered a good use of their cash. It shows the pressure they are under and I wouldn't be surprised if the markets continue to pick on them. Fridays event is a bit like giving them a crutch to hide the broken leg they now have. It will give their capital levels a small boost short term but now they have 5 billion less to make a profit on with limited interest in the bond market to lend them replacement capital at good rates. Once the annalists redo their projections and the bond buyers get over their relief at getting their money back, Fridays gains might well disappear for them. It also opens up a problem for other banks. will pressure be put on them in the hope that they will pay back their unsecured debt.
A big part of the problem goes back to the fact that EU rules changed to allow banks to burden share if they get in trouble. The markets have decided that rather than wait for the proverbial to hit the fan they pressurize the banks considered weak into early payment of the riskiest bonds by attacking the share price. The plan worked on friday as far as I can see so whats to stop them doing the exact same thing to other banks. Mario might need widen the type of bonds he buys and the amount fairly quickly because a black hole for QE could easily open up. For sure banks are going to continue using up the QE funds they do get to bolster their own books. Not much chance of it ever seeing the light of the real economy it was meant to stimulate.
That's my reading on things. happy to hear other opinions
.... a recent article about greek banks.. and investors... ross & ...co..... news is not good... unstable political system will lay waste to every penny invested... a few requirements... a culture of hard work and ethics.... positive gdp... a stable political system..
Would not be putting any money on Ireland you understand because of my severe aversion to risk, but I am quietly confident that just like our little bank, it will come good again.
I have switched off my crystal ball and am refraining from further forecasts for the moment, because they must have been reading them in the City and I think there is enough turmoil going on.
My one hope now is that they have learnt the lesson that short term betting is best done on horses - where investments are made they should be attempting to look beyond the horizon in terms of time and not just as far as the end of the pier.
Good luck all and I will be watching tomorrow whilst I enjoy a glass of the good stuff. GO IRELAND....
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