Gen.acc.8se.pf Discussion Threads

[return_of_the_apeman] 01/6/2023 08:53

X-div today

Yield at offer price of 116.4p is 7.6% so have taken some more

[rongetsrich] 30/5/2023 06:12

Interesting value.

[sarkasm] 23/5/2023 15:08

Date of dividend payment 1 July 2023*
------------------------------------


*As the payment date falls on a non-working day, payment will be made on the first working day following the payment date.

[sarkasm] 23/5/2023 15:02

Latest Dividends

Summary Previous dividend Next dividend

Status Paid Declared

Type Interim Interim

Per share 4.438p 4.438p

Declaration date 21 Oct 2022 (Fri) 10 May 2023 (Wed)

Ex-div date 01 Dec 2022 (Thu) 01 Jun 2023 (Thu)

Pay date 03 Jan 2023 (Tue) 03 Jul 2023 (Mon)

[rimau1] 23/5/2023 13:47

Nice re-entry point for anyone who took profits refently, i added at £1.20 yesterday which by my rough calcs is a 7.25% yield, ex dividend next week too.

[hindsight] 10/5/2023 17:53

These are looking the weak one in the group again

[cwa1] 10/5/2023 17:24

Title of Security 8(7) /(8) % Cumulative Irredeemable
Preference shares of GBP1
Half year period to 30 June 2023
------------------------------------
Rate per cent actual/ Amount 4.4375% per share NET
payable in cash per share
------------------------------------
Date and time by which Transfer 2 June 2023
must be lodged with the Company
for transferees to receive this
dividend
------------------------------------
Date of dividend payment 1 July 2023

*As the payment date falls on a non-working day, payment will be made on the first working day following the payment date.

[makinbuks] 20/3/2023 14:37

I believe the ECB and BOE have this morning commented on how unusual the CS deal is with regard to the AT1 bonds implying that its not how they would have done it.

[spectoacc] 20/3/2023 12:54

I doubt Aviva will ever struggle to pay the prefs.

But if there was uncertainty before - and there was - that Aviva couldn't pull something after 2026, there shouldn't be any now. The Swiss, albeit in a uniquely Swiss way, have just wiped out $16bn of bondholders, by changing the law on a Sunday evening.

$16bn.

Now, GACA/B could as easily go out at a large premium, as they could at par. But the point is the odds on either, and how the odds have now moved.

As for whether this means lower interest rates, more persistent inflation, and less value in prefs - maybe. But lower rates also means lower returns elsewhere, so all things being equal, ought to balance off.

I'd say the prefs are better value now than they were last week.

[cassini] 20/3/2023 12:46

Makinbuks,

As I understand it, the expectations for rate rises are now lower than they were, as the Fed essentially broke the banking system with its rate rises so far so can't keep raising. In theory then (?), the prefs should rise, not fall.

That leaves possible persistent inflation (as the Fed can't raise rates without causing a crisis apparently), systemic financial risk and effectively the return of monetary easing (money printing) as risks going forward.

Now the market likes monetary easing, but the Fed was trying to tighten monetary policy so its return looks like a big failure.

I suppose this all calls into question the future ability of Aviva to pay the dividends, or at least, puts the up the risk associated with the prefs, hence the price drop.

That's my take anyway, maybe someone else has a view.

[spectoacc] 20/3/2023 12:36

@Makinbuks - definitely CS AT1 bondholders ranking below equity.

[montyhedge] 20/3/2023 12:12

I'm reviewing my holdings on bonds and prefs, after the disgraceful treatment of CS bond holders, where shareholders saved.

[makinbuks] 20/3/2023 12:02

Why are prefs off across the board today? Is it that the recent banking crisis is over and central banks will therefore raise rates again or is it because of concerns related to the treatment of Credit Suisse bond holders?

[wmb194] 20/3/2023 11:31

Yes, just try to buy close to par. If you think this is a risk for all prefs today's turmoil is seeing RSA's 7.375% prefs being offered at 99.84p as I type (LSE:RSAB).

[wmb194] 20/3/2023 11:24

Elsa wrote, "Recent comment has suggested Aviva might try in 2026 to make an offer for the prefs... So even if they were bought in at par..."

But no one will accept an offer at par. It will be like with the NatWest prefs. Over the years NatWest has made low-ball offer after low-ball offer and there's been very little take up and they're still listed.

[return_of_the_apeman] 20/3/2023 11:24

@elsa7878

If redemption at par is a personal worry for you then why not just buy GACB instead, the yield difference is pretty insignificant

[ammons] 20/3/2023 10:55

Following the extremely hot water Aviva found itself in over trying to retire the prefs at par, the company issued this statement:



23 March 2018

This document includes inside information



Statement on Aviva plc and General Accident plc preference shares



Since the full year results announcement on 8 March 2018, Aviva plc ("Aviva") has heard a wide range of views on its preference shares*, has spoken to a large number of investors and has received strong feedback and criticism.



As a result Aviva has listened. Aviva announces that it has decided to take no action to cancel its preference shares.



Under current regulation the preference shares will no longer count as regulatory capital in 2026. Aviva will work towards obtaining regulatory approval for the preference shares, or a suitable substitute, to qualify as capital from 2026 onwards. If as we approach 2026 Aviva needs to reconsider this position, it will do so after taking into account the fair market value of the preference shares at that time.



On 8 March 2018 Aviva stated it has the ability to cancel the preference shares at par value, having received clear legal advice. The review of the preference shares was initiated as a result of Aviva's duty to examine what is right for the business, balancing the interests of ordinary shareholders and preference shareholders. Aviva needed to address the issue of the preference shares given regulatory capital considerations and their cost.



Aviva is in a strong financial position and still plans to deploy £3 billion of excess cash in 2018 and 2019 to reduce hybrid debt, fund bolt-on acquisitions and buy back ordinary shares.

[badtime] 20/3/2023 10:52

Prefs down across the sector today

[elsa7878] 20/3/2023 10:23

Recent comment has suggested Aviva might try in 2026 to make an offer for the prefs when there is the change in the capital structure. In the interim holders receive 4 years of dividends or 35.5p.

So even if they were bought in at par you would receive 35.5p - 20p (share price at 120 - 100 par) = approx 16p or 4p per year which in an ISA would be tax free. If you believe that inflation will fall to below 4% (and forecasts are lower) then it's an interesting investment now.

I am just trying to confirm that above details.

Many thanks (never bought a pref before)- though I notice that Aviva itself is now paying dividends of over 7.75% on it's listed shares (31p/400).

[cassini] 20/3/2023 10:00

Isn't it to do with the prefs no longer being Tier 1 capital after 2026?

[skyship] 20/3/2023 09:57

Others have said it all. Really elsa, you may be new here; but we've all been through the hoops over this so many times over the past 5yrs. AVIVA were forced to back down. Chairman & CEO had to fall on their swords after their sheer stupidity.

Their will be nothing done which might impinge on shareholder value.

Also not sure what you mean with this intro sentence:

"At the moment you're getting 3 x the annual yield for 2023-2025 plus some /all of 2026? So not adjusting for inflation you can't lose your capital, plus if Aviva make an offer."

Elucidate perhaps...

[wmb194] 20/3/2023 09:49

Elsa, please can you be more specific in what you're referring to? Are you referring to a recent announcement or one from 2018? What it said in 2018 re the prefs was followed by a massive investor backlash and outcry and it backed down and even paid compensation to some preference shareholders relating to the adverse market movements it caused.

[elsa7878] 20/3/2023 09:31

It seems the change in capital structure is post-2026 - so that's an additional year of dividends.

[flyer61] 20/3/2023 08:50

elsa 7878

2023 is a different world for Aviva compared to 2018. Whilst it might have stated that then, there is now a new CEO. She is woke and I doubt it would enter her mind to stuff the little people like us. So relax! I'm sure Skyship will be along shortly with (he/his) take.