Brit Insurance Share Discussion Threads

[crawford] 29/1/2010 11:17

Tipped again by money morning - they're like the non-life sector:

"But some could give you an even better return. Right now, the pick of the bunch, dividend-payment wise, is England cricket sponsor Brit Insurance (LSE: BRE). Thomas Dorner of Oriel Securities says that at 186p, this is on a p/e of just 5.7 and a forward yield of 8.6% - as well as price/net asset value of 0.67, i.e. you're buying £1 of assets for 67p. He reckons that's "compelling value".

[fxbond] 24/1/2010 18:11

It would be better if we could ELECT our monarch from the line of accession so I could vote for PRINCE HARRY - HAROLD 2nd ?_

[fxbond] 23/1/2010 16:15

Bought a few Beazley (BEZ) perhaps less current yield but good earnings projection and some fund buying recently but ayor bearing in mind last summer figures.

[18bt] 13/1/2010 15:09

For a very long time. They'd just consolidate the share capital if they ran out of capacity. Suspect they haven't been specific so as 1) not to wind up the Government and 2) not to be hide-bond if there is some change in legislation.

[scburbs] 13/1/2010 12:34

Thanks 18BT. Very interesting. Any idea how long they can pay "dividends" in this way?

[iomhere] 13/1/2010 11:37

If held in an ISA, presumably the distribution is untaxed which effectively gives an extra amount equal to the tax credit that would previously have been deducted?

[18bt] 13/1/2010 08:50

From the press release:

It is anticipated that, for an initial period, New Brit is unlikely to pay dividends but instead will make distributions to shareholders by way of reductions of the par value of the New Brit Shares (i.e. in the form of a capital distribution). Under current law and practice, any payments to New Brit Shareholders on such a reduction of capital should be free from Dutch dividend withholding tax whilst they are made out of the Recognised Capital of New Brit. To facilitate its intended distribution policy, the Board of New Brit expects to propose that the New Brit Shares are consolidated prior to its first distribution.

Then from the circular:
Distributions by repayment of share capital
The payment by New Brit for the cancellation of a fixed proportion of the nominal value of each New Brit Share held (a "repayment of nominal share capital") will not generally constitute an income distribution for UK tax purposes in the hands of New Brit Shareholders. Instead, in such circumstances, a New Brit Shareholder will be treated as having made a part disposal of their New Brit Shares for the purposes of UK taxation on chargeable gains. Accordingly, no part of the proceeds received by a New Brit Shareholder pursuant to a repayment of nominal share capital should be treated as an income receipt in that shareholder's hands for UK tax purposes. Those proceeds will not carry any entitlement to a tax credit and, in the hands of a corporate
shareholder, will not constitute franked investment income.
A New Brit Shareholder who disposes of part of their holding of New Brit Shares pursuant to a repayment of nominal share capital may, depending on their circumstances (including whether the 'small part disposal rules' described below apply), be charged to capital gains tax or (in the case of a company) corporation tax on the amount of any chargeable gain realised. In computing such gain, the allowable acquisition cost on the part disposal will be calculated by apportioning the acquisition cost of the part disposed of and the part retained by reference to their respective market values.
Under current HMRC practice, a New Brit Shareholder who receives payment for the disposal of part of their holding of New Brit Shares in circumstances where the cash received is "small" as compared to the overall value of their holding of New Brit Shares should be entitled to treat the cash as a deduction from the acquisition cost of the New Brit Shares. For this purpose, HMRC generally considers the amount of cash received to be "small" when such amount is 5 per cent. or less of the market value of the relevant holding or is less than £3,000.

But DYOR.

[scburbs] 13/1/2010 08:05

18BT, What makes you think that? Was it in something they released at the time of the conversion?

[18bt] 13/1/2010 07:54

With the new tax regime in place, these shares are highly suitable for the new 50% tax payer as the "dividends" are treated as a return of capital attracting CGT @18%. Complicates the tax return a bit, but good saving.

[evox] 12/1/2010 21:41

18BT thanks for the clarification. Assumed this was the case as I have a big chunk of these in my ISA but it's good to see it confirmed (and that BRIT are responsive). Good luck with your investment. Yield and outlook are great.

[18bt] 12/1/2010 12:30

Got the following very quickly from BRIT IR department whether still eligible for an ISA: "there's no problem in investing in Brit shares in an ISA. You can invest in foreign equities as long as they are listed on a recognised stock exchange, i.e. it is the exchange that matters and Brit shares remain listed on the LSE main market. "

Good service guys.

Have just swapped out of RSA and into BRIT as slightly better yield, growth prospects and premium to NAV IMHO.

[barrygibb] 07/1/2010 13:44

Time to top up I think
BG

[harry rags] 07/1/2010 12:57

Not today its not Cold weather problems?

[crawford] 04/1/2010 16:42

Steadily recovering.

[edmundshaw] 23/12/2009 11:32

Nice to see disclosed shorts. It means guaranteed future buying! :-)

[effortless cool] 22/12/2009 16:31

You would think if you were going to build up a multi-million pound short position you would at least know the proper name of the company you were shorting.

Form TR-3. FSA Version 1.0 June 2008

TR-3: Disclosure of Disclosable Short Position relating to Securities which are the subject of a rights issue

1. Full name of person(s) holding the disclosable short position:
Alpha Advantage Europe F Fund

2: Name of the issuer of the relevant securities
British Insurance Holdings Plc

3: Disclosable short position
(0.34%)

4. Date that disclosable short position was reached or exceeded
21st December 2009

[fxbond] 22/12/2009 11:07

I don't expect to see 1.45-50 but 1.20-25 should not be ruled out. There is a camp that favours less than parity but also sterling improves against euro when the $ reverses its decline -if that continues. Does anyone really know for sure how much drag the PIGS will have on euro compared with strength of German economy in particular.

[1fox1] 21/12/2009 15:40

no offence, but that last post is garbage ref euro.

[fxbond] 21/12/2009 13:55

Thanks lynton3 Vsery useful. This stock is one I sold with a bundle a few weeks ago and overlooked when moving them into ISA ! I am trying to work out the forward vision on these bearing in mind that despite the present regime for taxing these ultimately are a euro denominated stock and I see sterling as undervalued contra euro unless we get a Labour Govt or other than a short period of left minority Govt.

[lynton3] 21/12/2009 10:43

FXBond

Like you, I was concerned about the tax effect on dividends, and got the following helpful answer from Brit's investor relations:



In the announcement relating to the Dutch move we said:

"It is anticipated that for an initial period New Brit is unlikely to pay dividends but instead will make distributions to shareholders by way of reductions of the par value of the New Brit Shares (i.e. in the form of a capital distribution)."

What this means is that the cash amount of any payment will be the same as under the old structure but that you will receive it as a return of capital not as a dividend.

Of course, individual circumstances are all different and if in doubt you should always seek tax advice but assuming you are an individual for tax purposes, the distribution should fall under the capital gains tax regime and not the income tax regime.

There will therefore not be a tax credit as it is no longer required.

When you sell your shares in the future you will need to pay capital gains tax on any gain made if the sum of all your capital gains in any year is over the annual exemption of c£10,000. The tax rate on gains is 18% which is lower than the equivalent income tax rate if you are a higher rate tax payer.

In calculating the gain you will need to deduct the sum of any capital returns from your purchase price to calculate the purchase price to be used in the gain calculation (i.e. the gain will increase by an amount equivalent to the distributions received). Prior to selling your shares you should not need to pay tax on the distributions as you receive them.

[little beaker] 20/12/2009 23:27

Buy, short term target 220p.

Favourable on NTAV and yield vs other non-life

[fxbond] 18/12/2009 23:22

Acording to RNS 4080E of todays date these are a Depository interest in Crest in uncertified form.It is a Dutch company with primary listing in London with a nominal 1EURO value this suggests to me dividend paid in sterling but puzzled about whether its still subject to Dutch tax -I am inclined to think not. Incidently I offered my 750 LLPE bought at 57p for exchange and was accepted despite 1000 being the minimum eligible number.Sometime I might sell them and get my LLPE back depending on how things go.

[crawford] 18/12/2009 15:13

Had a wee top up here, would be rude not to at that price.

[fxbond] 18/12/2009 14:35

I wonder if the divi on these might be now subject to Dutch witholding tax -18 or 20% maybe ? Would apreciate if anyone knows for certain.

[kiwi2007] 15/12/2009 08:54

UBS upgrades Brit Insurance to BUY from Neutral following recent share price weakness. It maintains the 211p price target.