HGH - Heartland Group Holdings

[Untamed]

I use whichever bank(s) will meet my needs and serve me best. I am the customer and they are providing me with a service. If a bank can't meet my needs, I'll switch to one that does. It matters not one iota whether they are Kiwi owned or not. In this day and age, and especially in current times, I have zero guilt about that.

I prefer to support kiwi business so only have money in Kiwibank/Heartland and SBS which has been around since 1869.

[winner (n)]

Bit of a worry when seemingly intelligent people on here and that other place are talking run on the banks (smaller ones?)o

Maybe what they say about social media spreading news so much faster than in the past does trigger these actions

[BlackPeter]

Last published accounts to 31 Dec 2022

Statement of Financial position

Cash  - 385 million

Borrowings from Depositors ( Note 9 ) - 4.07 Billion of which 800.3 million are on demand ( Note 15 - titled Liquidity Risk )

I have no reason to suspect Heartland are likely to fail any time soon either but it is within the bounds of possibility....

It is clearly not within the bounds of possibility based on the data you provided (i.e. comparing short term cash with short term liabilities).

Have a look at the design of our banking system and the role of the reserve bank.

[Crackity]

It is clearly not within the bounds of possibility based on the data you provided (i.e. comparing short term cash with short term liabilities).

Have a look at the design of our banking system and the role of the reserve bank.

It absolutely within the bounds of possibility if you look at the last set of financial statements BP

You don't have to agree - I don't mind

[lorraina]

Page 32 Heartland presentation 28/02/2023

Heartland Group
Heartland increased borrowings by $158.3 million (2.6%) to $6,329.1 million.
New Zealand
• Heartland Bank increased borrowings by $249.7 million (5.7%) to $4,596.3 million.
‒ Deposits grew $480.5 million (13.4%) to $4,077.7 million, driven by competitive pricing on
targeted products, including Heartland's Notice Saver offerings which both received Canstar
New Zealand recognition in the half.2
‒ In Q1 of FY2023, Heartland Bank experienced the highest growth rate in retail deposits of all
main and domestic banks in NZ.1
‒ Other borrowings decreased by $230.8 million (30.8%), largely due to the maturity of $150
million retail bond, as well as the amount drawn down in Heartland Bank's committed auto
warehouse facility decreasing by $76.6 million.
• Total liquidity strengthened, increasing by $146.9 million (23.4%) to $774.8 million.
• Heartland Bank holds liquidity well in excess of regulatory minimums and maintains strong
regulatory liquidity ratios.

[Clearasmud]

Thanks Percy.
Hard to see how they couldn't cope with a depositor panic.
Do you think their loan book is robust?

[lorraina]

Yes their book is robust,motor vehicle lending,Rural stock lending,Reverse Equity loans,business ,first mortgages.
Over the past couple of years Heartland have let their net interest margin reduce [slightly],as the quality of their loan book improves.
From their 28-02-2023 announcement
‒ Impairment expense as a percentage of average Receivables decreased from 0.33% in 1H2022 to 0.29% in 1H2023, benefitting from an improved book quality.

ps.Motor vehicle lending.I find it interesting to note both Heartland and Turners, have greatly improved the quality of their motor lending books.Both do very well in this sector.

pps.Here is a link to HGH's 28-02-2023 presentation.
It is informative.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/HBL/407457/389620.pdf

[kiwi2007]

Excellent review of the NZ banking system:
https://www.nzherald.co.nz/business/cooking-the-books-podcast-why-higher-interest-rates-are-causing-banks-to-collapse/BA5UGFJLVVACTLLS6OSKAOI4Y4/

[mcdongle]

My apologies for assuming you were a holder. I don't think it was an unreasonable assumption to make though, that most people posting in an HGH thread, are probably holders.

I wasn't getting "wound up"about about what you do with your money, but as a holder of HGH, and a banking customer, I think I am fairly justified in being a little concerned that people appear to be panicking about a possible bank collapse. There is currently zero reason to believe Heartland Bank is likely to fail. I was merely expressing my opinion that making a decision out of a sense of panic, without any facts to support it, is probably not the best move.




Thanks.... But i wasnt panicking  i moved some of it to a higher rate of interest and also bought a new car....

[Basil]

No desire from me to comment or opine on this other than to post information from RBNZ on credit ratings which outline the chances of a bank at various credit rating level's being unable to make a timely payment i.e. default.
https://www.rbnz.govt.nz/regulation-and-supervision/oversight-of-banks/standards-and-requirements-for-banks/bank-credit-ratings
People might like to review the different credit ratings of the banks they are considering dealing with.
Also worth mentioning that the RBNZ does have very wide powers under the open banking resolution to give stability to the banking system when required.
More info here https://www.rbnz.govt.nz/regulation-and-supervision/oversight-of-banks/standards-and-requirements-for-banks/open-bank-resolution
DYOR.
Disc - Not currently a shareholder of HGH and no material funds in a bank account with them.

[BlackPeter]

It absolutely within the bounds of possibility if you look at the last set of financial statements BP

You don't have to agree - I don't mind

You still forgot the role of the reserve bank ... you need to add their balance sheet when assessing the "Possibility of default" of any bank. As long as the bank has sufficient long term assets / securities on their balance sheet the reserve bank will happily help them out to cover any short term shortfalls at the official cash rate. Actually - this is the role of the reserve bank.

As well - Reserve banks can't run out of cash - they print it.

Have a think and maybe some reading about it before you respond. I am just concerned to see posters whose contribution I normally value starting inadvertently (I assume) to add to the huge pile of misinformation on the internet.

[Crackity]

You still forgot the role of the reserve bank ... you need to add their balance sheet when assessing the "Possibility of default" of any bank. As long as the bank has sufficient long term assets / securities on their balance sheet the reserve bank will happily help them out to cover any short term shortfalls at the official cash rate. Actually - this is the role of the reserve bank.

As well - Reserve banks can't run out of cash - they print it.

Have a think and maybe some reading about it before you respond. I am just concerned to see posters whose contribution I normally value starting inadvertently (I assume) to add to the huge pile of misinformation on the internet.

Sure

Thanks for that

I'm obviously missing something in how bank panics start and how banks work and how second tier banks work.

[Waltzing]

The commentary tonight on CNBC this bank loan book problem is going to be here for a few years or more.

Looks like some heavy reading through the winter to brush up on relationship between the T and bank deposits. Right now the T is above the deposit rate.

Citizen on the other hand just went sky high.

With internet banking apps being in your phone money moves a lot faster than in 2008.

SP handles might be reacting to that?

Sp here bottomed at 90 in the year of the Virus and this thing just went down again..

[lorraina]

From an article by Brian Easton
Brian Easton, an independent scholar, is an economist, social statistician, public policy analyst and historian.

Currently your best choice is to be cautious about your return – the higher return, the greater the risk – and to choose financial institutions which are well supervised and regulated by the Reserve Bank of New Zealand.

PS.Wife and I hold shares in GEN and HGH,both of which are as above.

[winner (n)]

From an article by Brian Easton
Brian Easton, an independent scholar, is an economist, social statistician, public policy analyst and historian.

"Currently your best choice is to be cautious about your return – the higher return, the greater the risk – and to choose financial institutions which are well supervised and regulated by the Reserve Bank of New Zealand."

PS.Wife and I hold shares in GEN and HGH,both of which are as above.

Good old Brian eh

But both you and Brian are echos of Richard Long who influenced many with his " Hanover, a New Zealand business with the size and strength to withstand any conditions."