Lloyds Grp 9.25 Discussion Threads

[bobdouthwaite] 15/4/2009 09:45

Kimboy, take a look at the iii LLPC board and especially Michael Whitaker's posts - his post of 6 April refers to NWBD

[solomon9] 15/4/2009 09:43

Lord Gnome - thanks for the RBS-PL rec- I bought at $3.25 just before the xd date so net price $2.89- gonna hold - rising tide lifts all boats.

[zangdook] 15/4/2009 09:40

Kimboy - AFAIK it's just that RBS is in worse shape than Lloyds. I'm not sure how the requirement to pay pref divis first works with subsidiaries like NatWest, Abbey National, General Accident, Bristol & West - do they have to pay the prefs before they hand their profits to the parent company? NatWest itself is profitable, isn't it?
But LLPF yields more than either, until 2015 at least. Unless it's gone up this morning.

[lord gnome] 15/4/2009 09:35

Not in my view Kimboy2. I hold both, but if I were buying more I'd be buying the NWBD. I also hold NYSE RBS:L - currently paying around 25%.

[kimboy2] 15/4/2009 08:58

Is there any advantage to LLPC to NWBD which yields about 50% more.

[jonwig] 15/4/2009 08:42

LOL - but you get my drift?

[zangdook] 15/4/2009 08:41

jonwig - it hasn't been paid yet.

[jonwig] 15/4/2009 08:30

Kirkie - you could argue that the more often these prefs get paid, the more confident people will feel that they'll always be paid.

(Like the turkeys who were fed every morning so knew they'd always get fed ... then Christmas came.)

[kirkie001] 15/4/2009 08:24

....And the drop is also less than the 4.625p that would be expected (currently showing on my screen as a 3.75p drop)....

Wonder if the buying pressure will fade away now that the share has gone XD?

[lord gnome] 15/4/2009 08:15

Ex-div day.

[pennypunter] 13/4/2009 22:30

I agree with sol's point that given the market making in this stock it appears that a big seller has been cleared, hence the market makers are weary of quoting wide and will want to cover orders, ie mark up their prices. I do not think much has changed at Lloyds in the last week.

[skylaunch] 13/4/2009 10:39

In a way surely, one has to consider the global aspect - that things don't look QUITE as bad as they did say last January, so there is an increased possibility of these instrument's dividends being paid.
Then add in the fact that Lloyds particularly has been cleaned up and made fairly bomb proof.
Then add in that the Prefs have never not been paid before.
Then add in that at 16% yield, brighter minds than ours are now buying them as an investment albeit a high risk one i.e. they've moved down the risk scale by 20%.
Then I think you can see why they are rising.

[solomon9] 11/4/2009 20:46

If the sizes available are only small, as you suggest then that means that a big seller (s), ie a stock overhang has been cleared, this relieves pressure on the stock. It means that market makers now can only fund purchases either from their own stock, which is likely to be limited due to their small 1,000 share size, or from sales. Hence a rush of buying provokes a rise in the price as mm try to attract sellers. but if this is the case why did all the other Lloyds prefs rise sharply?

[sommet2] 10/4/2009 18:09

davidosh,
No problem. We all have different experiences.I sold most of my prefs ( 8 different holdings) in June 2008 after watching the capital fall by about £30k.If I had held on until today I would have lost about £70k so selling was the right choice.Having said that they produced a great amount of income and I sold with reluctance.I have since bought and sold a few times.I only sold because I was worried the whole UK economy would implode.To be honest I am now scared to touch either Lloyds or RBS because the toxic debt they both put in the Asset Protection Programme shows how dangerous their balance sheets are.I was shocked by the amounts.All the projections for the UK economy are bad and of course this will result in more bad debts and impairments for the UK banks - this will be on top of the impairments they will suffer from assets in the APP.If you got in at the recent lows you did well and have a big cushion but at current levels I think they are overpriced which is why I favour Aviva and others.

[davidosh] 10/4/2009 17:19

I like a spread of risk so bought RBS and LLOY. They are not really comparable due to the exchange rate risks, US. withholding tax implications etc but the huge yield at 52% when I bought covered that. I did buy a few more at only 30% yield with the dollar dividends. I will probably look away from the banks for my next prefs.

Incidentally I mentioned these to about four FDs holding net cash and moaning about interest returns. For just 5% of their net cash deposited here they can double the annual interest return on the remainder.

[kimboy2] 10/4/2009 16:50

Well you could sell these to buy some more RBS prefs and double your yield.

Is the RBS any more risky than LLOY ?

I presume that we may be getting some trading statments in the next month or so. They will be interesting.

[davidosh] 10/4/2009 16:35

Apologies for questioning a decision to sell but surely unless you need the money these are a buy and sit tight investment due to the high yield. Why sell at 40p when the annual return is almost 25% ?? I accept there is risk and there has to be or the whole investment world would pile in but having bought with an amount you can afford to lose it is best to sit tight and let the banking sector concerns play through to a finish...Illiquidity will always hurt if you get the wrong side of it and I first bought these at 79p thinking they were a good buy !! Certainly not prepared to jump off whilst they provide a return second only to my RBS prefs in the US. which have doubled thankfully since my purchase when the world was falling off a cliff.

[holts] 10/4/2009 16:15

there was a change last week, you could not get larger amounts (over 5k) without paying a premium, I noticed that some larger tranches that had appeared on the collins stewart weekly list had gone , so sentiment has changed ? or the upcoming divi date is being anticipated , any other thoughts?

[sommet2] 10/4/2009 15:36

Old Boy Returns.
I agree with everything you have said.Unfortunately I did not anticipate the recent rise and had sold out one month before- kicking myself now.What put me off was that the MM's were happy when I bought 20k but when it came to selling they would only give me their advertised price for lots of 1k.The alternative was to accept a price of about 20% below.I managed to sell 7 lots of 1k each before my broker told me that the MM was no longer prepared to take my orders.I waited 2 more days and eventually sold the rest in one order in disgust.When the market is good you can buy and sell in size but when it goes bad it is difficult to sell these.To a certain extent this holds true for most prefs apart from the Coop ones - I dont know why, perhaps they are more liquid.I am waiting for a fixed deposit to mature on the 1st May and intend putting a lot into the Aviva prefs which seem very good value and they are cum.

[solomon9] 10/4/2009 12:41

Interesting move over the last week, but only problem is its still very retail, no evidence of any institutional interest. Would have thought the prefs have further to go if Lloyds reports only small loss. The bond buyback move will lift profits in the short-term.

[zangdook] 09/4/2009 14:43

This is currently paying just over 13%. ANLA is paying over 12.5%, and Santander has to be stronger than Lloyds. I think this must be near the top unless ANLA goes up too, or irrational exuberance kicks in (assuming it hasn't already).

[zangdook] 09/4/2009 14:29

OBR - LLPF pay 6.0884% until 2015 when they pay 3-month LIBOR + 1.31% which currently works out around 3%, I think. No doubt it will be higher in 2015, but I think that uncertainty is also a factor in the price.

I wish I'd got myself together in time to buy these before this rise. Any thoughts on where they'll stop? Or if they'll fall back?

[old boy returns] 09/4/2009 12:55

The lloyd's prefs all seem to be moving upwards at present. Personally I wish they had stayed down for longer as I would have bought more when the cash became available from maturing fixed rate deposits. I have accumulated a lot of the LLPF which seem to trade at a discount (and so higher yield) to the others for no other reason than they are traded in chunks of 1,000 and so a bit less liquid. But I got a load at a 25% yield and will not be selling so I can live with that.

[blobby] 09/4/2009 12:26

No comments for a few days. Perhaps this is the answer :-)