Lloyds Grp 9.25 Discussion Threads

[solomon9] 13/2/2009 21:42

Yeah i bought the Bank of Ireland 13.375% bonds then the Lloyds announcement arrived. I reckon will pick em up cheaper next week. Bear in mind they are paying the 6.47% prefs and are likely to pay these too.

[bluetooth] 13/2/2009 17:39

Bad day for LLOY - I've always thought the prefs would be safe but I've just had my confidence knocked. I have just spoken to a guy who works for Lloyd in a senior sales role and in the course of the conversation about the day's events, I told him that I had bought some prefs for the dividend. A pained look crossed his face and when pressed, he said that he didn't think that it would be paid. I hope that he is wrong and I continue to hold!

[future financier] 10/2/2009 16:44

Didn't see your order go thru solomon?

[diku] 09/2/2009 21:32

when is the due date?...and when does the stock go ex divi to qualify?...is 9.25% net Divi?...

[solomon9] 09/2/2009 21:14

Alright tell you what- I had a call from Eric last night and he said he's gonna pay in cash on the due date, no bull, as he has on the 6.47% prefs. So guess what I buying 50k LLPC tomorrow.

[spittingbarrel] 09/2/2009 17:26

Holts - only valuable if the govt doesn't engineer very high (hyper) inflation, and lets face it, how else can they reduce debt?

[holts] 08/2/2009 16:45

Thinking 5 years ahead , is it worth buying a shed load of these now ? you may forgo income for a while , but it will be very valuable over a twenty year view.

[eithin] 06/2/2009 15:45

My guess script div for 9.25% and 9.75%... Can see no other reason...

[solomon9] 06/2/2009 15:35

Yes I am aware of that; the point was why have they declared on the 6.47% prefs? Don't duck the question mate.

[dalesiders] 06/2/2009 11:32

bonds is bonds
shares is shares

[solomon9] 06/2/2009 09:49

they offered a 13% coupon to holders to Tier 2 to convert to Tier 1 bonds

[renew] 06/2/2009 09:46

solomon
Youve lost me. Not difficult!
What do you mean by "Why did they offer 13% to convert to tier1 ?"

[solomon9] 05/2/2009 22:20

If its so cut and dried, then why pay on the 6.47% prefs; the stock has gone xd and given a pay date?

Why did they offer 13% to holders to convert into Tier one; they could have offered a lot less.

There are a number of issues here both for and against; yes the paltry payment in lieu of changing the rules stinks. But they would be mad to pass on the divi one their own, a lot depends on whether other banks do it.

Quite possibly its half time and Lloyds Banking could itself get acquired in the next round.

[p@] 05/2/2009 14:03

Dale-Must admit there is a lot of truth in what you say.

[dalesiders] 05/2/2009 13:51

P@- In this whole sorry banking debacle if your philosophy had been to think the worst you would have been correct. I bought the HBOX prefs as the payout was compulsory if there were sufficient distributable profits to pay just the prefs, end if that was not the case the board could issue scrip in lieu.

What happened - they tore up the class rights and gave us less than 1/2p a share compensation!

They would have to borrow the cash from the BoE to make the payments.

No bank will be issuing prefs in the near future. These were issued as a sort of hybrid Tier 1 instrument. If banks need capital in the future the only entity with sufficiently large pockets will be HMG

And it's called nationalisation

[future financier] 05/2/2009 12:48

At current yields on the prefs (17% after tax) they couldn't afford prefs! But to be serious - how often do banks issue prefs these days?

Anyway with the ords rising from 45p to £1 isn't it about time these followed?

[p@] 05/2/2009 12:26

FF-if they passed the div on the pref They would definately have trouble in raising future money on pref shares.

[future financier] 05/2/2009 11:54

dalesiders - I am with you on this - there would be negligible effect on credit ratings from passing pref div - the company's state of healthis already well factored into the prices. Furthermore the board's prime concerns will be keeping the ords happy - and passing a pref div now will bring forward the day when they will have the reserves to resume payments to the ords (and of course this will entail resuming payments on prefs).

Sadly!

[dalesiders] 04/2/2009 18:39

I don't see the logic. The prefs are shareholders too. If they choose not to pay the pref dividend then they don't have to shell out on the extortionate 12% govt prefs. We will be in the same boat as the ordinary shareholders.

Why do you think they removed the additional rights on the HBOS prefs?

If they defaulted on the bonds that would be adifferent matter.

[holts] 04/2/2009 15:53

I have been thinking like you Sol, if they pass the pref div then it has to have all sorts of implications for their credit ratings/ability to raise money etc.

[solomon9] 04/2/2009 14:04

Lloyds 6.47% prefs have gone xd today!!

[lord gnome] 04/2/2009 09:28

Not yet - and like you, I remain hopeful that it stays that way.

[solomon9] 04/2/2009 08:59

I note the opinions of you learned gentlemen and thank you for them.

If I may make a few observations of my own, and feel free to comment.

I am not so sure they will take the atomic step of not paying the pref dividends at all in 2009 or for just H1 2009. This is an effective statement that the bank cannot pay interest on its debts, it could lead to very bad publicity/ winding up actions/ a freeze on lending to Lloyds and at the very least a shut down in the hybrid market which the BoE is trying to revive.

Is there any other UK bank, that has not been nationalised, that has passed on the pref dividends or said they would?