Lloyds Grp 9.25 Discussion Threads

[lord gnome] 21/1/2009 18:43

Sorry p@, but you have lost me. What do you mean by 'they have only just issued these'?
Does anyone know for certain that NRKP are still having divis paid? Sounds a bit far fetched to me. If so, then why the panic to sell the LLOY and NWBD prefs down to junk bond status? Surely the selling was all about the fear of nationalisation and the chance of a total loss of capital and the loss of the divi income. If we going to have our divis paid come what may, then I will be buying more. I remain to be convinced.

[p@] 21/1/2009 17:26

Sky-They have only just issued these,I really can't see the Gov letting the div go this early,GB would have to admit to Lloyds failure too quick. 23% tax free.

Sky prefs are basic tax free so why bother clogging up your SIPP?

[p@] 21/1/2009 16:52

FF-Yes Ticker NRKP I have bought and sold them quite a few times and have had some big Divs as I have these, I am out now cos these are better as you dont have to buy the accumulated Div on these that you do on NRKP.

[future financier] 21/1/2009 15:48

p@ - is that true about NRK prefs - but don't forget we lost some of our rights on conversion from HBOA into LLPC.

[p@] 21/1/2009 15:42

Just bought 5000 of these hope it's a bargain they should pay the divi (9.25%Tax free) Cos they're still paying the divi on Northern rock prefs!


Yield about 23%!!!!!!!! Tax free.

[colinc57] 21/1/2009 15:36

Not disagreeing.. but to short sterling at this level is a big risk in itself.. if a couple of the us or europeans banks also get hit bad again then the pound might gain

[ptolemy] 21/1/2009 15:32

I see your point. By binary I meant, nationalise or not nationalise. I can't see HMG making an unambiguous statement either way, short term. Hence my 'middle way' suggestion which leads to a limping wounded bank for several years. Only when they start to reduce their equity share will we know the worst is over and the price will rise accordingly. That could be years away, though the price could show quite some volatility in the meantime.

I think the obvious hedge is to short sterling. If the banks are nationalised sterling is toast imo. Nobody should know this better than Brown. I think he'll try other things before going there.

[future financier] 21/1/2009 15:12

Given that LLOY is in the blue now these must rise similarly. Anybody out there buying?

[future financier] 21/1/2009 15:10

Ptolemy - but surely you have just described a binary scenario - even if Prudence ends up owning 99.99% of the ords these come out ahead in terms of rights on distribution - so eithe worth nothing or the value of a 9% yielding gilt - say 150p?

[eithin] 21/1/2009 14:40

Prefs Illiquid maybe reason. The 6.475% went ex divi 6th. Feb last year with pay date 17th. March...

[ptolemy] 21/1/2009 14:40

My view. The prefs are trading at equity prices because the market thinks that the chance of both becoming worthless has increased significantly.

Prefs are always illiquid in a falling market (afterall they are only sold if interest rates are rising to a high level or the issuer is likely to default). But other than that I think the RBS pref news on monday really spooked some holders. RBS converted the govt prefs into ordinaries. something that shouldn't be possible on these (or likely given the small float) but with HMG in control who knows. Why would they do it for a few million?

Many seem to view this as a binary bet but I think there are several middle ways forward. One is that HMG does not nationalise LBG but keeps increasing its equity (ad infinitum if necessary); dilluting the ordinaries but gaining (near) total control. I can't see them nationalising all the banks (though who knows) and RBS is in a much weaker position, so my view is that the fate of RBS (and the Irish banks) is a clue to our fate. Perhaps Obama's plan may just surprise with some novel ideas. No point to sell in any size at these prices. Just my opinion.

[spittingbarrel] 21/1/2009 14:22

In the past i've given orders to Barclays to sell preference shares at best, and the mm's really ripped my eyes out, so I suspect that's why some low sale prices are going through.

[colinc57] 21/1/2009 13:54

would it be better if someone created a single LLoy pref thread ( combining LLPC & LLPE - with a redirection link on the 2 original EPIC threads) as we are really all in the same boat

[colinc57] 21/1/2009 13:50

can only assume its much lower volume, and if no buyers the MM are offering to buy at whatever they want ( not sure what Normal trade size is) - makes the quote look silly though - haven't got access to a platform that will show me what they will really sell at really ( ie punter buy)

[future financier] 21/1/2009 13:43

colin - can you explain to me what is happening on LLPD - the quote is still 53-55 with hte last transaction at 43?

[hosede] 21/1/2009 13:10

If I weren't already sitting on a chunk of the 6.475% bought around 64p I would be having a flutter but.....

[colinc57] 21/1/2009 12:50

just think what these would be worth if no issues and paying over 9% compared with current bank rates ... might have topped £2 !!!

[colinc57] 21/1/2009 12:48

hosede
rate is a factor, in pricing but so is the value on redemption ( or bust) .. plus 6.475 go ex div soon

[colinc57] 21/1/2009 12:46

FF - nice idea , but seems regardless to quote - sales on LPD are going thro' at 40p

[future financier] 21/1/2009 12:21

hosed

Just noticed the 9.75% prefs LLPD are at 56p - so short LLPD and long LLPC you can't lose (I think).

DYOR!!!!

[future financier] 21/1/2009 12:06

Pricing is determined by fear of them being worth nothing - effectively the market is saying there is a two thirds probability that that is so!!

With Government policy largely guided by the pronouncements of Vince Cable - my take is that if LLOY is nationalised these should almost certainly be paid out at par. Will LLOY be allowed to go bust - no. So I reckon this must be an absolute bargain.

Just wish I had the confidence to back this with some cash! - but I don't trust the competence or the integrity of Prudence and Darling.

[hosede] 21/1/2009 11:02

The 9.25% prefs are now almost the same price as the 6.475% - is there a difference in the terms? otherwise they look a much better bet

[colinc57] 21/1/2009 09:49

under HBOS these prefs - usually ex div start of may and start of Nov.. payment about 4 weeks after

[davidosh] 20/1/2009 17:30

When is the next payment due and under what circumstances could the Lloyds board prevent a payment being distributed to holders ??