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https://www.theaic.co.uk/companydata/henderson-far-east-income/announcements/399671
The seemingly perpetual and massive gap between analysts targets and the actual share price can only be explained by incompetence. I was there (on MD level) for more than five years and watched them systematically dismantle meritocracy in favour of an intense focus on race and gender. The non-client focused culture was already broken before this. It felt like working for the Government i.e. the exact opposite of what I was used to for many years on Wall Street. Besides, with their limited product range and 99% focus on the UK, their ability to grow is very limited. I still have lots of deferred compensation shares that are not vested and every program is under water. This is not a corporation hungry for profits, it is a woke playdate for lazy people that should not be in business.
I am more than vaguely interested. Yield is 75% of the reason I am in this stock.
Guitar, you are a balanced commentator. Read you with pleasure.
Guitar, I understand this viewpoint. The reason I am against Government (the UN actually) getting involved is that 1. It is socialism messing with free market capitalism and I am not aware of a socialist society that has ever looked after its natural resources or its people. and 2. There is a strong positive correlation between economic wealth and social benefits including less pollution and preservation of nature.
Western societies are now making energy extremely expensive which leads to richer totalitarian societies (Russia, Saudi, Iran) and moves manufacturing and wealth to China (Communist). None of these four nations gives one iota about about social justice, pollution or "global warming". We are shooting ourselves in the foot. Today EU signed off on a new "climate bill" which will make things much worse for poor people in Europe and will weaken Western democracies. That's not great for the planet. In the US I support/invest in Strive's ETF's which proactively is trying to fight ESG. I am not aware of similar efforts in Europe...
Thanks! One major concern I have with my UK and EU investments is the focus on ESG well aware that the more regulation, taxes, energy hostility and other "well meaning" initiatives, investor returns will be lower, society hence poorer and ultimately social benefits will be lower. For instance "progressive" states in the US follow this model and have become un-investable. In California, the epicentre of homelessness, modular homes would be fantastic but it is just too expensive because of extreme regulation, high taxes and high energy costs. Even these modular homes built in the UK are clearly too expensive... I have no problem LGEN investing in a portfolio of this type assuming it is ultimately for investor benefit, not "charity" fitting into an ESG presentation.
Thanks!
I worry about the ESG focus. I have been moving my portfolio out of companies that focus on that.
Regional REIT's share price is down 10% YTD, -38% one year and -34% two years so perhaps they should worry more about SHAREHOLDER VALUE! Making shareholders poor while making "communities" or overzealous builders rich is not a sustainable business model. At least not in a free market system.
Thanks all! Any views on what triggered the significant fall the last few days(on pretty big volumes)??
While completely under water on my holding now t is very tempting to double up....(my biggest investment failure...).
Cheeers,
Looks like a hold and pray...
Just to clarify, US Banks, and US community Banks, also follow BASEL 3 liquidity ratio regimes. Just like European Banks. However, European Banks are weighted down with insane EU regulation in terms of MiFid but also on ESG. A couple of reasons why returns on North American Banks have exceeded European Banks. However, SVB was one of the biggest proponents of ESG, DEI and Wokeness and as they seemingly abandoned meritocracy for this new undemocratic anti-western religion it is not stupid to assume they lost focus on what they need to do to run a bank. Pretty much like the Biden administration. If this religion is not removed we can expect almost all areas of society to collapse. Already many examples of that.
Obviously important to optimise your portfolio in your tax situation and certainly in the UK the best opportunities may lie in the various tax free wrappers. But these big shares like LGEN are owned internationally so for us in Switzerland for example we pay income tax on dividends but no capital gains tax on shares (or bonds). In the US you pay income tax on dividends and capital gains tax which depends on the length of the holding period. That's even before institutional ownership and speculative trading kicks in. All in all, in my view, the international and diversity of ownership of these type of companies provides no opportunity to "be smart". Best thing, in my view, is to look at your own personal tax situation and design a strategy accordingly.
I don t understand this reasoning. While I agree (with analysts) that the stock is cheap from a valuation perspective, the Bank is not transforming, not in a good way anyway. They are in the same geography with the same (diminishing) product range and they still have not improved markets shares or capabilities of their Private Bank or their Commercial Bank. Their Transformation investments vastly prioritise costs, not new product investments. All they "can" do is to cut costs and hope that the UK economy improves to reduce write offs. They do not have a fee business and their culture, after they eliminated meritocracy, is internally focused. I hope the stock will rise over and above Euro Stoxx Banks indices but history distinctly says otherwise.
Thanks for this!
Am also looking to load up a bit more as my dividend portfolio yields the next month. My main concern is really the lack of liquidity in the stock.
Fleecy, the way the construct deferred compensation schemes are extremely bad for recipients. They inflate the number on your payslip so it looks like you are being well paid but then you are either dependent on LBG hitting various qualitative goals (such as complaints, ROE etc) or the actual share-price itself (which obviously has been going down for 7 years). This is in theory good for the company but it has distinctly been bad for the employees. The combination of this payment method with the removal of merit virtually guarantees low quality poorly motivated employees. The only hope is cost cutting and improving interest rate margins.
Agree with the first post. Relative to the negative macro environment LBG may be come out better than others tomorrow.
I agree with Stagecoach. This requires a complete clean out of management because management consultants, incompetent diversity hires or old "leaning bankers" will not cut it. When I was there they did everything to reduce the fee income and focused exclusively on lending. And the UK only. NatWest had the people and the muscle memory to achieve this, LBG doesn't. But I understand Charlie is a keen cyclist. We all need helmets on this week.
This stock is exactly where it was 10 years ago when I first owned it (while also working there). It did well after the privatisation in a bullish market but for about 7 years it has done nothing else than going down. This is despite good interest rate margins, high UK markets shares in retail, cards and car financing. Plus analysts have been more bullish than not for all of this time. The stock is a slow follower in bull markets, a fast decliner in bear markets and the government will reduce dividends in crises. In summary it has no positive momentum today or over recent times. If I didn't already own a sizeable position from deferred compensation and yet to vest schemes, all of which are very much under water, I would not own this share. Plus during my 5-6 years there the quality of management deteriorated, meritocracy was completely abandoned and every attempt to build fee income (as opposed to interest rate income) was abandoned. Market shares in commercial banking, insurance and private banking never took off. One can hope for a good dividend this year and that funds will increase their allocation to LBG so that the share recovers, but it is hard for me to see any positive surprises unless there will be a solid FTSE bull market, a strongly improved UK economy via lower taxes and regulation and peace in Ukraine.
What do you mean? Am foreign investor and not as familiar with the news...
Does anybody have any comments on the call this week? I found it informative (the slides were really good) and somewhat reassuring so will continue to build the position. But my goodness, in my days on "Wall Street" in New York and London you actually had people with a heartbeat that presented to investors...