Close Brothers Share Discussion Threads

[jonnybig] 19/9/2024 07:29

Very good results. NAV of 1.8 billion, the market cap of 800 million is a huge discount even with a possible big compensation pay out.

spud

[hamhamham1] 19/9/2024 07:28

And...

Close Brothers agrees sale of Close Brothers Asset Management to Oaktree

Close Brothers Group plc ("the group" or "Close Brothers") has agreed to sell its wealth management business, Close Brothers Asset Management ("CBAM"), to funds managed by Oaktree Capital Management, L.P. ("Oaktree") for an equity value of up to £200 million (the "Transaction").


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The equity value of up to £200 million, including £28 million of contingent deferred consideration in the form of preference shares, represents a multiple of 27 times CBAM's statutory operating profit after tax for the 2024

[hamhamham1] 19/9/2024 07:27

Nice results ;)

[suetballs] 18/9/2024 12:23

This will be the first - nothing provided at the interim results stage.
Suet

[j2m] 18/9/2024 12:09

Does anyone know if they have already made any provisions for FCA enquiry or will this be the first? Many thanks.

[suetballs] 18/9/2024 11:52

I don't think they will declare a dividend.
I am hoping they can put some flesh on the possible/probable liabilities and make a prudent provision. Hopefully covered by dividend suspensions and cost savings.
Then perhaps to some extent we can move on.
Suet

[thebutler] 18/9/2024 11:04

Results tomorrow.

With the FCA postponing the results of their investigation, I wonder if by the same token CBG will "delay" the dividend suspension and declare one with the results, even if just a reduced amount. Just a thought.

[orlando42] 16/9/2024 10:18

Maybe it’s not him but someone in his family. Whoever it is, wishing them well

[suetballs] 16/9/2024 07:32

Leave of absence - hope Sainsbury is going to be ok.
Results still set for Thursday.
Suet

[stoopid] 13/9/2024 14:05

Won't be long now, Thursday for full year results. UBS is expecting an initial @£50m write down of a possible total of up to £280m for the motor finance probe. FCA due to report on that and issue fines/compensation rules in Mar/May 2025.Should be good news for winterflood/CBAM and good margins on loans.No mention of Novitas and hopefully no further provisions there either.https://www.proactiveinvestors.co.uk/companies/news/1056207/close-bros-rally-to-be-tested-in-full-year-update-1056207.html

[j2m] 09/9/2024 11:51

Banks, oil and water companies. Easy hits for government to take windfall tax with very few people making a stink about it. Basically they can do what they want for the next five years (possibly 10) as we now have no meaningful opposition.

[suetballs] 09/9/2024 10:40

Windfall tax on banks - I think there will be something in the budget.
But no account will be taken of the pain that bank investors have "shouldered" for many years.
Who'd be an investor and relying on a defined benefit pension scheme to fund retirement.
Suet

[suetballs] 09/9/2024 10:35

Provision in the accounts for motor commission:
I think it has gone further than just putting a note in the accounts. This problem is imo material for cbg
Lloyds have already included a sizeable provision and I am not sure if others have. I appreciate that Barclays are fighting it.
These are not interim accounts and will be audited. True and fair becomes an issue.
A specific provision will reduce the corporation tax bill.
Just my thoughts - but not long to wait.
Suet

[stoopid] 06/9/2024 19:55

Suet, as far as I am aware, no, they don't. The investigation hasn't finished and no liabilities or punishments have been announced. Therefore, there is no reason to take a hit in the results.CBG can show an initial "provision" if they want to and it will also mean that they will have a very large cash surplus. Novitas could be the only fly in the ointment so to speak if there are further writedowns to show, but, as it was wound down last year, there should be no further liabilities there.So personally, I'm expecting good margins on lending, winterflood/wealth management to do well with increased business, and a large cash surplus to cover the FCA investigation results in December...

[suetballs] 05/9/2024 16:02

Well as it's the annual results they're going to have to include a provision for the car loan stuff. It will be interesting to see their assumptions/methodology.
Not long to wait now.
Suet

[tsmith2] 05/9/2024 15:01

Financial CalendarAs previously announced, the group has discontinued the issuance of pre-close trading updates in order to align more closely with prevailing market and industry practice.The group is provisionally rescheduling the release of its preliminary results for the 2024 financial year to 19 September 2024 (from 24 September 2024).

[j2m] 03/9/2024 19:49

Where TF has the recent blogs gone?

[karv1] 03/9/2024 16:35

You maybe correct but the risk still remain for ensample this is all from memory in the 14 years they lent out the 16 billion and with some loose numbers if the average borrower took out 8k that's 2million customers. with the FCA saying on average they think people over paid by 1k that is over 2m x 1k,plus interest at 8% per year that could be compounding onto the debt until possibly 2026 now.............

This is an insane amount and super worst case probably will not happen but no one knows, anything could happen it is a risk..................

When it was at £3 there was a possible 300 to 400% return and a 22% yearly dividend if everything goes well v the risk. finding out around 25th sep

Now there could be 100% to 150% possible return and a 12% yearly dividend, v the risk with possible outcome in 2026

At what point does the seesaw effect against the 9% and 10% other dividend stocks become more tempting with far less risk,
.On the risk v reward seesaw.

[stoopid] 03/9/2024 09:11

Sorry, what huge unknown risk do you mean? If you mean the FCA investigation into historic car loans, well, it's not unknown, and it's not huge. CBG already know about it and have taken steps by raising capital (eg divi cancellation) to pay any fines/compensation.Novitas is being wound down and there should be no more large liabilities there either?

[karv1] 31/8/2024 13:13

The stock has done amazing but at the same time it seems everyone has forgotten the huge unknown risk, unless more info has come out.

[tsmith2] 31/8/2024 09:23

278 - 911 is the one year range. Crazy

[tsmith2] 30/8/2024 10:18

(Sharecast News) - Close Brothers surged on Thursday as RBC Capital Markets upgraded the shares to 'outperform' from 'sector perform' and hiked the price target to 620p from 375p, citing a number of potential catalysts.The bank argued that whether you are looking at historical or sector-relative valuation, Close Brothers shares screen as cheap.It noted that the shares have underperformed the sector by around 55% year-to-date.RBC said the bad news around the Financial Conduct Authority's review of motor finance is now well embedded into consensus and net interest margin and loan growth assumptions are sensible."Therefore, we currently see asymmetric risk to the upside, as the market continues to myopically focus on capital, while we see a number of potential catalysts including: i) a softening of Basel 3.1; ii) a Novitas settlement; iii) IRB approval," it said."Structurally, it is helpful that CBG's NIM is relatively agnostic to a falling rate environment."

[suetballs] 30/8/2024 09:16

RBC view



Suet - always relatively agnostic!!