HGH - Heartland Group Holdings

[Basil]

Because index funds are technically driven - they simply buy more of what is going up in price (increased index weighting) and sell more of what is going down in price (reduced index weighting).  When companies decline in price so much they are removed from the index completely and replaced by something that is better.  Thats why its difficult to outperform an index - because TA outperforms FA.

Maybe it does the way you do FA ?
I wonder how I've beaten the NZX50 for 15 years in a row..I guess I am just extra lucky...but then again, the odds on beating the index 15 years in a row based purely on luck if you have a 50% chance of beating it each year are 1 in 32,768.  Maybe high quality, thorough fundamental analysis beats TA 
Anyway, back on track of things that will affect HGH's happy go lucky approach to lending...unemployment forecast to continue to increase through to mid 2025 so we'll see the effects of that flowing through until at least FY26 and that's before dealing with the losses from the bad bank.
https://www.stuff.co.nz/business/360474067/why-unemployment-expected-rise-5

[winner (n)]

Maybe it does the way you do FA ?
I wonder how I've beaten the NZX50 for 15 years in a row..I guess I am just extra lucky...but then again, the odds on beating the index 15 years in a row based purely on luck if you have a 50% chance of beating it each year are 1 in 32,768.  Maybe high quality, thorough fundamental analysis beats TA 
Anyway, back on track of things that will affect HGH's happy go lucky approach to lending...unemployment forecast to continue to increase through to mid 2025 so we'll see the effects of that flowing through until at least FY26 and that's before dealing with the losses from the bad bank.
https://www.stuff.co.nz/business/360474067/why-unemployment-expected-rise-5

Maybe it does the way you do FA ?
I wonder how I've beaten the NZX50 for 15 years in a row..I guess I am just extra lucky...but then again, the odds on beating the index 15 years in a row based purely on luck if you have a 50% chance of beating it each year are 1 in 32,768.  Maybe high quality, thorough fundamental analysis beats TA 
Anyway, back on track of things that will affect HGH's happy go lucky approach to lending...unemployment forecast to continue to increase through to mid 2025 so we'll see the effects of that flowing through until at least FY26 and that's before dealing with the losses from the bad bank.
https://www.stuff.co.nz/business/360474067/why-unemployment-expected-rise-5

Sounds like this 'bad bank' is going to report strong growth!   

[winner (n)]

Tony Alexander pointed out that from the latest NZIER Business Outlook survey that a net 41% of businesses have said they expect their costs to rise and a net 7% have said they plan raising their prices.

Hmm ...looks like a huge margin crunch coming next year

Talk of inflation being beaten and rates coming down will make for better times could just be a false dawn

Maybe tough times (for both business and household) will continue through to 2026

Not good for Heartland

[KW]

Maybe it does the way you do FA ?
I wonder how I've beaten the NZX50 for 15 years in a row..I guess I am just extra lucky...but then again, the odds on beating the index 15 years in a row based purely on luck if you have a 50% chance of beating it each year are 1 in 32,768.  Maybe high quality, thorough fundamental analysis beats TA 
Anyway, back on track of things that will affect HGH's happy go lucky approach to lending...unemployment forecast to continue to increase through to mid 2025 so we'll see the effects of that flowing through until at least FY26 and that's before dealing with the losses from the bad bank.
https://www.stuff.co.nz/business/360474067/why-unemployment-expected-rise-5

Nah, I think its because the NZX50 is so full of crap companies, that if you stick to the 5 good ones, you automatically beat the other 45. 

[Basil]

RBNZ might even cut by 75 bps at the end of this month but that still leaves us for at least 3 more months with very restrictive monetary policy at a time when many business's are saying conditions are worse than the GFC. Lazarus saying at the annual meeting that company and business insolvencies are going up year to date in FY25 compared to FY24 is another clue this ship is not turning around anytime soon.

Hey Winner, it crossed my mind at the annual meeting when talking to Greg to ask how his other nag is going but I thought the better of it as it is quite clear he's not happy with how this one is running.  Not cool to rub salt Into the wound eh.

[Basil]

Nah, I think its because the NZX50 is so full of crap companies, that if you stick to the 5 good ones, you automatically beat the other 45.

But you need to do good fundnwntal analysis to sort the wheat from all the chaff 

[Left Field]

Nah, I think its because the NZX50 is so full of crap companies, that if you stick to the 5 good ones, you automatically beat the other 45.

Beating the NZ50 could be regarded as a pretty low bar measure these days.....unless of course you aim to outperform the NZX50 by 10 to 20% pa. 

KW is right. It's much better to pick better performing individual stocks rather than index funds.

Check out FPH and IFT v the NZX50 over the last 10yrs.

[winner (n)]

Guru Brad on TV just saying that petrol prices are relstively low at the moment and that's helping businesses and households

[winner (n)]

................

Hey Winner, it crossed my mind at the annual meeting when talking to Greg to ask how his other nag is going but I thought the better of it as it is quite clear he's not happy with how this one is running.  Not cool to rub salt Into the wound eh.

You forget about that concept of "the owner's eyes" ......... so no worries really with these 2 nags ...Greg has things under control

[Basil]

Having met him I wouldn't be so sure about that.  I suspect he finds his other business investments way more rewarding than his listed dog's.

[Basil]

https://www.heartland.co.nz/about-us/news/heartland-bank-announces-leanne-lazarus-as-new-ceo
A bit more detail around the key cost to income ratio that I found so deeply concerning.
Excerpt "Leanne's extensive experience in operations and technology will contribute to advancing Heartland Bank's digitalisation strategy, and the ongoing reduction of Heartland Bank's cost-to-income ratio through removing customer friction and enhancing customer experience".
Interesting that this was one of the key reasons she was hired so it's fair to ask how she's going so far ?

Hired halfway through FY23 so not fair to say she could make any meaningful change until FY24 but I note CTI history of 43.6% in FY22, 44.9% in FY23, (she was there for half that year) and made a major impact in FY24 with a huge jump to 48%.  She's certainly having a big impact but not the one she was hired for.  But wait there's more..., she very quietly let it slip in the annual meeting the CTI for FY25 was expected to increase again...but it's all okay because by FY28 it will be down to 35%....why does a huge Tui billboard so readily spring to mind lol  I note they now have two highly paid separate senior executive teams for Heartland N.Z. and Heartland Australia plus a third team gorging themselves from the bank trough, for the group.  Yeah, that'll really help get the CTI down heaps lol.  Going north of 50% for FY25 ?  She was also adamant in discussion with me after the meeting she hadn't created a bad bank division within HGH.  I would love to have had the gonads to tell her this in person.  I think that's complete and utter B.S.

She's a great look for diversity and inclusion but it will be interesting to follow how she gets on with her key objectives.  Happy to watch from the sidelines for a while.  Another Tui yeah right moment on the day, Greg Tomlinson was adamant they were only doing the ESG things they had to do by regulation.  He and another director were adamant that shorters had an absolute field day at their expense in the lead up to their much-needed capital raise.  That rang true to my ears.

[Ferg]

Did I hear the answer correctly that the 'bad bank' loans were already provisioned?

[Basil]

They said they were but shut down my questioning and any further questioning from the floor from anyone else in a huge hurry.  I really wanted to ask the auditor publicly if they had been through those dodgy assets with a fine-tooth comb but was not allowed the opportunity to do so.
The way questioning was shut down was an absolute crock of s@#t.  Plenty of things to try and hide is the clear impression I got.
Not sure if there's a recording anywhere of the meeting?  I wouldn't mind hearing their so-called answers again.  Hard to take everything in when you are Johnny on the spot thinking how to phrase the next question.

[winner (n)]

Basil ...this looks ominious for Leanne ...some say line heading to 3,000

You cannot view this attachment.

[winner (n)]

Did I hear the answer correctly that the 'bad bank' loans were already provisioned?

Page 23 of this preso itemizes the NSA stuff

The fine print says 'Receivables are as 30 June 2024 excluding provisions'

Whatever that means

https://api.nzx.com/public/announcement/437072/attachment/426005/437072-426005.pdf