Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
https://www.youtube.com/watch?v=Nxeu6z6serY&list=RDNxeu6z6serY&index=2
Tangler , listen to the music it might help ..
Good luck Oakie
PenguinZ , I tell you why you are confused and conflicted - its because youre failing to see the bigger picture & the longterm . Cant see the woods for tree's.... Instead of worrying about a couple of pennies rise or fall , why not see the return to the 60's - because it will happen .
For those who say blah , blah , blah markets this & global markets that - it doesnt matter becasue longterm Lloyds will rise .
Cheers -
Banks have been told they will be given an extended period to rebuild their capital and liquidity buffers to meet regulatory requirements after the pandemic is over to ensure that they can support the economy.
Lenders are on the front line of the national response to the lockdown by getting cash to struggling companies. As well as the government’s emergency loan scheme, they are providing repayment holidays, forbearance and debt forgiveness.
The efforts will drain the banks of liquidity and will eat into their loss-absorbing capital, but the Bank of England said yesterday that they should use “the substantial capital and liquidity buffers that have been built up to support the economy”.
Liquidity refers to a lender’s stock of assets that can be sold easily for cash to hand to customers who are drawing down deposits and loans. Capital is the protection that banks have in reserve to absorb losses on their loans.
To alleviate concerns, the Bank said on its website that “there is no specified time period during which banks must rebuild their capital buffers . . . The [Bank] will give banks a sufficient period of time for these to be restored”.
It added that it would “consider the individual circumstances of each bank” and “the need for banks to be able to support their customers and clients as they bridge the economic disruption related to Covid-19 . . . Where capital buffers need to be restored, this will be a gradual process and the [Bank] will not, in general, expect banks to restore their capital buffers in full until a significant time after the end of the current stress”.
The same principles will apply to the rules on liquidity. Lenders will be allowed to run liquidity levels below what would be expected in normal times. “Banks are expected to use their liquidity buffers, even if it means liquidity coverage ratios go significantly below 100 per cent,” the Bank said in guidance to lenders. Going below 100 per cent, a key threshold, “will not trigger any automatic restrictions”.
Sir Philip Hampton, who was parachuted in to chair Royal Bank of Scotland during the crisis, says Woods has “a lively, inquiring mind”. Hampton, who no longer chairs RBS, adds he is the sort of person who is “understated, unpolitical, very much getting on with the job, thinking it through, organising things sensibly — he doesn’t seek the limelight”.
Woods says the banks have “rebuilt” since the crisis and have both the capacity and and the willingness to lend. His boss, Andrew Bailey — who took over just as the Covid-19 crisis unfolded — last week told banks to “put their backs” into getting out loans through CBILS.
“They have lots of room to lend. Going in to this, we’ll be fine,” Woods says.
The angst “is the prospect of a lot of corporate defaults and downgrades”. What hit could the banking sector take?
The banking industry’s combined 14.8% capital ratio is the equivalent of £240bn, and under stress tests the PRA allows that to fall to 7.5%, which would indicate, very crudely, the capacity to absorb £120bn of losses. “It would be a huge loss, a very worrying thing,” says Woods. “But I have no expectation we’ll see losses on that scale.”
Big businesses are hoarding cash, having drawn down billions of pounds from revolving credit facilities with the lenders. The Bank said recently that there were £260bn of undrawn facilities before the crisis hit. It is not clear what the demand for rescue loans will be, he acknowledges.
On May 7 — Woods’ 47th birthday — the Bank will publish its assessment of the hit to the economy in its scheduled monetary policy report, as well as the implications for financial stability in an emergency update, which comes after last week’s eye-grabbing scenarios from the Office for Budget Responsibility. The 35% contraction in the second quarter — the most in 300 years — is “not implausible”, he says.
“The question for us is, if the economy jagged down and bounced back up again [as the OBR suggested], how well equipped is the banking sector to help the rest of the economy through that?”
Unlike the banking crisis, this is an economic shock that is having an effect on the financial system. So far it has been able to absorb the shock, he says.
Despite the uncertainty, Woods is not panicking. “I don’t think you should do my kind of job if you’re not calm. We are starting the crisis from a good place. We’ve had enough time since the financial crisis to rebuild the system.
“Now we’re going to see how it does in this test.”
While Woods would have preferred a more voluntary approach, he says: “It is understandable that there were a range of views, and in the end it was the right thing to do to keep that capital in the system given the huge uncertainty we face, but I don’t find it at all worrying that it was not an easy thing to get agreement to.”
By the time the co-ordinated announcements from banks were made about the abandonment of dividends, on March 31, regulators at the European Central Bank had already moved. In a perfect world, says Woods, the ECB and the Bank might have made an announcement on the same day, but what matters was “we had the same outlook”.
The decision was not taken lightly — or quickly. The counter-cyclical buffers were relaxed on March 11 and the dividend-halting letter was sent on March 31.
“We were careful not to reach a final view until a few minutes before we sent that letter to the banks,” says Woods. At the same time, cash bonuses were put on hold, although he says payments could still be made in shares.
The same diktat on dividends was not imposed on insurance, where general insurers such as Aviva have halted payments while life insurers such as Legal & General have continued to pay out. Banks and insurers are not the same, says Woods, and neither are all insurers. “The biggest uncertainty we’ve got here is what is the extent of the need going to be on the banking sector in bridging the economy through this? That motivates a safety-first thing on the banking side that isn’t quite there on the insurance side.”
The insurers look to be getting an easy ride, not paying out on policies for business interruption caused by the pandemic. Woods says that where there is some uncertainty about the need to pay out, insurers should do so. But he adds: “What doesn’t make sense is to expect insurance companies to cover huge things they had no expectation of covering. Some of the business interruption side is like that.
“They would not expect to cover a very wide, pandemic-driven business interruption. They deliberately excluded that because they could see it would be a very large hit.”
A government-backed scheme — similar to those in place for floods and terrorism — may eventually be needed, he says.
Woods, a New Zealander with Irish and British passports who was educated at Winchester and Oxford, regulated insurers at the PRA until he took the top job in July 2016. He also worked at the Financial Services Authority, before which he spent 10 years at the Treasury, coinciding with the banking crisis.
He was charged with setting up the body to look after the stakes in the bailed-out banks, and later on the Vickers review that led to ring-fencing of high street banking from investment banking.
Sir Philip Hampton, who was parachuted in to chair Royal Bank of Scotland during the crisis, says Woods has “a lively, inquiring mind”. Hampton, who no longer chairs RBS, adds he is the sort of person who is “understated, unpolitical,
Sam Woods interview: I had to threaten the banks over dividends
The Bank of England deputy governor had to fire off letters to persuade lenders to stop payouts
Sunday April 19 2020, 12.01am, The Sunday Times
Sam Woods dug out a tie last week. The top regulator at the Bank of England smartened up for an appearance before MPs on the Treasury committee, joining the virtual meeting from his bedroom at home in Stockwell, south London. It was the first time that Woods — one of the Bank’s four deputy governors — had sported neckwear since he and his family went into lockdown a week earlier than most of Britain, after one of them (since recovered) developed a cough potentially associated with Covid-19.
At the time, the advice was to isolate. “Being a regulator, I follow the rules,” he says, speaking by phone from that same bedroom. (Internal video-style audiences have not been cleared by the Bank’s security team.)
There is double regulatory trouble in the household: his wife, Mary Starks, is No 2 at energy regulator Ofgem, which surely spells a life of rules for their three children — 14, 12 and 10. Not so, according to Woods, who says they take more of an “eyebrow-raising” approach. “Firm but fair is the approach, both at home and at work. You’ve got to have some rules and they’ve got to be proportionate or people won’t subscribe to them.”
That eyebrow-raising approach — the traditional way the Bank has expressed its displeasure to the companies it regulates — has been sorely tested during the coronavirus pandemic, which has created turmoil on financial markets and forced the Bank to embark on two emergency rate cuts, a pledge to buy £200bn of bonds through an expansion of quantitative easing, and the government to back a £330bn loan scheme for cash-strapped businesses. Capital requirements on banks have eased — so-called counter-cyclical buffers — to free £23bn of capital.
Speaking for the first time since banks halted £7.6bn of dividends, Woods acknowledges that lenders did not easily acquiesce to his Prudential Regulation Authority’s (PRA) wish to stop payouts.
“We live in a much more legally constrained environment than would have been the case 20 or 30 years ago. There is a role for the eyebrows, but also a very important role for due process,” he says.
He had to fire off letters to bank bosses spelling out the need to conserve cash. Some of the banks, such as Barclays, were ex-dividend, so its shareholders were expecting the £1bn payment, while there were also implications for those with investors in Hong Kong, such as HSBC.
Continued
So are we going to see similar provisioning from British banks in their Q1 statements in two weeks? Probably not. The Prudential Regulation Authority has explicitly told them not to be too gloomy.
The new accounting standard IFRS9 was specifically designed to enable them to anticipate future losses — to smoothe the pain of future downturns. But the PRA is so worried that the losses would eat into their capital levels and dent their ability to lend it is instructing them to take a cheery view.
It’s not clear that that is necessary. Sam Woods, head of the PRA, told MPs this week that a parallel stimulus measure, the reduction of the counter-cyclical buffer, would alone reduce banks’ capital needs by £23 billion, enabling them to lend a whopping extra £190 billion.
continued
If that’s the case, the additional concession on expected loan losses looks unnecessary. Telling bank accountants to turn a blind eye to the 1.2 million householders already having to take mortgage holidays, for example, is not especially prudent. Nor is it true and fair.
Another week, another emergency capital-raising. This time it was Informa, the exhibitions organiser, putting out the begging bowl, for £1 billion. Keeping the FTSE 250 company ticking over until it can crack on again with must-see shows like Power Nigeria and World of Concrete doesn’t come cheap.
With hindsight, the directors must be asking themselves whether it had really been sensible to load up the company with £2.4 billion of debt. That left it urgently needing an infusion of capital to get gearing down and keep its creditors happy.
Under the new norm, the notion that all existing shareholders get first refusal on newly issued shares has again gone out of the window. Rights issues are as popular now as handshakes. This was an offer available only to the anointed few.
There is another curiosity to this and other recent placings — the sheer number of banks with no great UK equity markets expertise being put on the placing roster, and so collecting generous fees.
Morgan Stanley, the actual corporate broker, is the joint global co-ordinator, along with Goldman Sachs. But then there is a long line of sub-advisers known as bookrunners, including HSBC, Santander and BNP Paribas.
It was the same with recent placings at WH Smith, Asos and SSP, according to some very suspicious traditional brokers. Commercial banks are again and again muscling in on what they regard as their patch. In many cases, those banks are conventional lenders to the company raising the cash. HSBC, Santander and BNP are all separately lenders to Informa via a £900 million revolving credit facility.
That raises the question of whether companies in need of the cash are being leant on to hire these banks as advisers and allow them to make some easy cash. Without doubt, say miffed corporate brokers, who add that the banks in some cases are required to do no actual work at all.
In those four placings alone, the fees amount to an estimated £30 million to £40 million. Getting hired also pushes the banks higher up closely watched transaction league tables.
Under its unbundling rules, the Financial Conduct Authority forbids banks from inserting restrictive contractual clauses in loan arrangements that would land them equity capital mandates. It goes further, saying that “unwritten oral agreements” are not allowed either.
No one is going to admit to receiving or inflicting undue pressure in these circumstances. Still, it is all distinctly rum. And once again it suggests undesirable cross-subsidies still exist within the world’s biggest banks.
Don’t be gloomy
Four of the biggest American banks have set aside $18.4 billion in the past few days because they expect borrowers to default in large numbers. JP Morgan Chase alone announced loan loss reserves of $4.4 billion to cater for personal customers defaulting on credit cards and consumer loans and $2.4 billion against business loan defaults.
So are we going to see similar provisioning from British
Your dilemma is quite simply .......this has been an age old problem since markets began & many a professional investor asks the same question ...
Not sure what to do ...Should I buy ? Should I sell ?
Answer ......Let the markets come to you , the answer will be revealed by the markets themselves ...wait & watch and then make your decision .
Cheers
The share price really isnt rocket Science..no charts or TA is going to tell us what is going to happen next ...
If the virus subsides & lock down is lifted = increase in share price
If the virus gets worse & lockdown continues = decrease in share price
And there you have it .
Good luck
Good luck
john46 . " For 4 yrs I have been warning folk on here there's a gap from 2009 @ 28p that needs closing "
Thing is john in TA world we know that not all gaps get closed - so it is by no means a certainty .
Cheers
Cheers
One of the people briefed on the calls said some banks felt more strongly than others, especially HSBC and Barclays because their shares had already gone ex-dividend, meaning only those who already owned the stock before that date were entitled to receive the payout. HSBC was also worried about the reaction among its Hong Kong retail investors, who own roughly a third of the shares.
Deputy BoE governor Sam Woods threatened to resort to his ‘supervisory powers’ if the lenders did not comply © Charlie Bibby/Financial Times
The conversations between Mr Woods and the CEOs did not become acrimonious, according to two people briefed on the phone calls. “Nobody at our end was criticising Sam,” said one. “Once the challenges of doing it voluntarily were made clear to him, he resorted to putting the proverbial gun to our head.”
“There wasn’t a back and forward long-running argument,” said one of the people briefed on the calls. “They recognised the position that the banks were in vis-à-vis their investors, particularly those who were ex-dividend.”
On Tuesday night, the banks announced that they were cancelling payments of their 2019 dividends and withholding 2020 dividends and buybacks, in a series of co-ordinated announcements alongside the BoE that wiped tens of billions of pounds off their market value on Wednesday.
The central bank said it welcomed the decisions, which came “in response to a request from us.” It also released a series of letters between Mr Woods and the chief executives, in which he threatened to resort to his “supervisory powers” had the lenders not complied.
One of the people briefed on the choreography of the announcements said it was the product of a compromise. Although the regulator had technically stopped short of forcing banks to act, Mr Woods’ letter set bankers a deadline of 8pm on Tuesday to agree to the “request” and even provided a template for their own statements.
“Once it was clear that the choice was between accepting the request or being told to do it, then all the banks chose, sensibly, the right way,” said one person briefed on the discussions. “The outcome was the same either way.”
UK banks resisted BoE calls for dividend cuts
UK banks resisted BoE calls for dividend cuts Central bank forced to make threats of supervisory action if lenders did not fall into line The dividend power struggle calls into question the longstanding ‘gentleman’s agreement’ between lenders and Threadneedle Street © PA Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) David Crow in New York, Stephen Morris and Nicholas Megaw in London 3 hours ago Print this page 19 Be the first to know about every new Coronavirus story Four out of the UK’s five largest banks resisted pressure by the Bank of England to voluntarily cancel their dividends, forcing the central bank to lay down the law, according to people familiar with the matter. On Tuesday HSBC, Barclays, RBS, Lloyds and Standard Chartered announced that they were cancelling dividends worth £7.5bn so they could “serve the needs of businesses and households” during the coronavirus shutdown. Bankers acquiesced to the BoE’s demands only after it failed to convince them to make the move of their own volition during a series of phone calls on Monday between executives and Sam Woods, deputy governor and head of the Prudential Regulation Authority, according to several people briefed on the discussions. Mr Woods’ intention was for the banks to make the announcement without public direction from the BoE, but leaders at four of the five lenders balked at the plan, the people said. RBS, which is majority owned by the taxpayer, was the only one willing to comply. “We all had exactly the same view,” said an executive at one of the four refusenik banks. “Just being asked to do it was not enough. We would have chosen to go ahead in paying the dividend and told the [BoE], ‘thanks very much for your input but we disagree’.” Another person briefed on the talks said: “Making the BoE force our hands was the only way of protecting ourselves from a shareholder revolt. If we had done it of our own volition then we would have faced legal challenges.” The BoE and all five banks declined to comment. The power struggle calls into question a longstanding “gentleman’s agreement” between lenders and Threadneedle Street, which for decades has made British banks bend to its will with little more than a raised eyebrow. Former BoE governor Mervyn King famously persuaded Barclays to remove its controversial CEO, Bob Diamond, in 2008 in a single conversation with then chairman, Marcus Agius, without having to resort to concrete action. In lobbying against the dividend ban this week, some of the banks argued their balance sheets were strong enough to make the payouts. They pointed out that they had passed the BoE’s stress tests last year, which measured whether the lenders were able to withstand an economic shock on a similar scale to the coronavirus fallout. One of the people briefed on the calls said some banks felt more strongly than others, especially HSBC and Barclays b
Hi Asperger1 , not a word from Lloyds - you really woulnt expect anythiny less from our CEO .
Surly they could make some comment explaining what they plan to do with the retained divi money ? Is it too much to ask ? that it may be paid out in the future all being well ? After all it is our money .
The last thing i expect from our CEO is communication - he's famous for that
john46 thank you - I shall bear that in mind .
Goes with the territory on these blog sites ....there were some crazy nights on the financial blogs back in the days of the financial crisis ...it really was incredible ....but also some amazing knowledgable posters helped us during those dark days
Most people are genuinely helpful but its at times like this when there is a crisis that all sorts come out ...
john46 - I hear you & understand . But there are posters talking the share down also ...for whatever reason that's up to them
Ive been around long enough to know the difference between someones genuine opinion , and then someone trying to justify their own insecure position..