Caliber Global Investment Share Discussion Threads

[lbo] 09/2/2007 09:38

Slower US housing market hits HSBC

Thursday, 8 February 2007 19:51

HSBC Holdings, Europe's biggest bank, has said its bad debt charge last year would be about $1.8 billion higher than expected, or up 20%, due to problems in its US mortgage lending business.

The slowing growth of the US housing market had led to more people not meeting repayments, HSBC said, increasing its liability.

However, the bank said that, aside from its US mortgage business, the rest of its 2006 performance had been in line with expectations

[garfield31] 08/2/2007 09:23

Drop looks overdone on figures given in release unless more bad news to come

[lbo] 31/1/2007 14:22

JPMorgan reduces mortgage exposure
DAVID ENRICH

NEW YORK - JPMorgan Chase & Co. is cutting its exposure to subprime mortgages amid deteriorating industry conditions that are proving troublesome to a growing group of lenders.

JPMorgan Chief Executive James Dimon said in an investor presentation Tuesday that the company has sold off most of the mortgage loans it made last year to people with weak credit histories. He said mortgages are the one area of subprime lending where "we really see something taking place that looks like a recession."

While the New York bank continued to hold $13.2 billion in subprime mortgages - making up 65 percent of its total subprime portfolio - as of the fourth quarter, that is down from $16.3 billion, or 72 percent of its total subprime portfolio, in the third quarter, JPMorgan said. Its overall subprime portfolio - which, in addition to mortgages, includes credit cards, auto loans and home equity loans - shrank to $20 billion from $23 billion in the third quarter.

Meanwhile, JPMorgan has classified $4.5 billion of its subprime mortgage loans as up for sale. The company says it expects them to be sold in the first half of the year.

JPMorgan said in the presentation that "loss severities" in subprime mortgages have started increasing, and that delinquencies of subprime loans originated last year are higher than the 2005 and 2004 vintages were at a comparable age. In the fourth quarter, JPMorgan saw net charge-off rates on subprime mortgage loans leap to 0.6 percent from 0.1 percent a year earlier.

When it released its fourth-quarter earnings earlier this month, JPMorgan boosted its retail bank's provision for loan losses to $262 million from $158 million a year earlier, due in part to what the bank described as "some deterioration in subprime mortgage." Dimon said Tuesday that even if defaults spiked to recession-like levels, it would probably only boost JPMorgan's credit costs by about $100 million a year. "This is not a particularly large risk for JPMorgan," he said.

With interest rates high and the housing market cooling, JPMorgan is hardly the only company struggling with subprime mortgages.

Wachovia Corp. recently shut down its EquiBanc Mortgage Corp. unit, following "an intensive strategic review of its mortgage business which has altered the company's approach to the origination of non-conforming loans," according to a message on EquiBanc's Web site. Countrywide Financial Corp., the nation's largest mortgage lender, offered a gloomy forecast when it announced fourth-quarter results Tuesday, citing continued credit deterioration in the entire mortgage industry. And a number of small subprime lenders have gone out of business, while others have sold themselves to Wall Street firms.

But Dimon said JPMorgan won't be exiting subprime lending. In fact, he said, if mortgage loans become cheap enough, the company would consider buying multibillion-dollar portfolios from other lenders. "We're an economic animal," he said

[lbo] 30/1/2007 18:52

Yes its doing well but not sure if it will last and have now gone short.

[oniabsta] 05/1/2007 20:45

Yes the telegraph,see above.

I think the recent strenghtening of the dollar has helped,although the fund is gradually transfering investments into europe.Last stated weighting in usa was down to 62% from 71%

[garfield31] 05/1/2007 13:38

Very helpful. Thanks for your time

I first heard about in in Money Week as having been tipped in one of the newspapers.

[oniabsta] 05/1/2007 12:18

My understanding as far as it goes is :-

Company deals in $ only, profits are in $ divis are paid in $
most MM's deal in $ only.For those that do you would need a $ dealing account.

When i bought my first tranche of these i bought in £, but when my broker tried to buy the second lot the MM's would only accept $. I incurred extra costs for my broker to exchange my pounds into $ to buy the shares as i didn't have a dollar account.

Sometime after i recieve a divi (in $ remember)my broker does a sweep and converts back to £ at the then prevailing exchange rate,so until that happens you won't know how much your divi is.

This all adds complication (exchange rate fluctuation)and extra cost.
At the end of the day it will have to be transfered into £ for you to spend :-)

Hope this helps

edit
Note there has been some serious buying last couple of weeks and the chart is on the up, i think word of this high yielding and undervalued fund is spreading

[garfield31] 05/1/2007 10:53

Can I test your patience further. I was offered shares in $ or £ and bought in £. The slight increase in price today means that just gone into profit. Expected greater cost to purchase in £. Suppose dividend costs will be greater if received in £.

[oniabsta] 04/1/2007 20:37

Your welcome!

[garfield31] 04/1/2007 20:36

thanks - have only looked at the postings before

[oniabsta] 04/1/2007 19:54

go to the "shares A-Z" search button on your monitor, found it straight away.

[garfield31] 04/1/2007 18:15

Have purchased shares today and will be interested to see how the $/£ conversion works out.

You mention Prodesse and I could not find this anywhere. Is it still available?

[oniabsta] 31/12/2006 13:45

Copied this from the first page of the "Caliber Global Investment Limited Full Year 2006 Results Presentation"

I particularly like the second to last line, regarding growth in earnings and dividends. It seems a very confident statement to me.

Net profit for Q4 2006 of $7.9m, making $22.2m for 2006

Earnings per share ("EPS") for Q4 of $0.32, making EPS of $1.18 for 2006

Dividend for Q4 2006 of $0.31 per share, in line with our target

Full year dividend of $1.10 per share, representing a 13.0% yield based on 10 November 2006 close price

Further significant growth in earnings and dividends anticipated

Net asset value ("NAV") of $9.69 (Q4 2005: $9.32)

[oniabsta] 22/12/2006 17:36

Flashheart - agree entirely, welcome aboard!

[flashheart] 22/12/2006 10:08

Pitched in with 500 this morning. This is a cash cow with one hell of an income and capital recovery prospects to boot.

[oniabsta] 18/12/2006 19:59

LBO - Your timing on starting this thread may well be opportune (fingers crossed)I have noticed a lot of activity the last few days,and i am hoping this could be the turning point.
The decline of the dollar has had a negative influence on this fund but again in recent days the dollar has strenghtened.I read recently that some top american bankers think that sterling will weaken against the $ in 2007.
I have been an investor in these from my first purchase around $11 and another at about $9.5 only to see it fall further. It's my biggest looser by far.
Many times i have thought about selling but i believe they will come good in the long run, meanwhile there's the divi currently about 16.7% yield.
best of luck!

[lbo] 18/12/2006 11:55

Caliber Global Investment

Now that the market looks like it is beginning to pause for breath, we have decided to look for some income stocks. In that respect, Caliber Global Investments (7.75p), which is trading on a prospective dividend yield of more than 17 per cent, is difficult to beat.

Like Prodesse, which we tipped last week, Caliber invests in mortgage-backed securities - large pools of mortgage debt sold in the capital markets. But Caliber works in a different way.

It makes its money on the difference between the cost of borrowing money and the income generated by these mortgage portfolios. All of that income is paid out in dividends.

The risk with Caliber is mortgage defaults. More than a quarter of its portfolio is invested in sub-investment grade or un-rated paper. Caliber's shares have been hammered this year by fears for the US housing market - more than 60 per cent of its portfolio is invested in US securities. While those fears are justified, the stock now looks oversold.

Caliber is trading on about six times its projected 2007 earnings, and at a slight discount to its net asset value per share. Although earnings may be dented by weakness in the US housing market, they won't disappear altogether. As a yield play, Caliber is an attractive buy.