review of the banks

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    I went to a private client update at Ord Minnett yesterday which was to look the future of the banks.

    Their views were (alphabetically):

    ANZ: Neutral (Hold)

    Low PER in relation to competitors
    Higher risk profile (due to offshore exposures)
    NBNZ funding concerns (No.1 bidder)
    ANZ/ING relationship dodgy

    CBA: Underweight (Sell)

    Loosing market share
    Capital adaquacy concerns
    ROE dilution
    Will increase if markt rally continues

    NAB: Overweight (Buy)

    Cheap at current price (relative to other banks)
    Earning sensitive to $AUD
    AMP does not make sense
    Ords/JPMOrgan believe NAB worth $40 per share

    WBC: Overweight (Buy)

    High end of earning range (9% EPS)
    High growth potential, low risk
    Long term efficiency gains starting to come through

    BOQ: Expensive (Sell)
    MBL: More like a Fund Manager (Buy)
    SUN: An Insurance company rather than a bank (Hold)
    SGB: No takeover. Great strategy (Hold/Buy)

    The outlook for the Banking sector is weak at the moment as International Insto's are moving money out of the Aus Banking stocks and into Asian growth countries.


    Disclosure: I'm short ANZ and CBA. No other banking positions
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