Cancellation/postponement of dividends

colin

In view of the increasing number of companies cancelling/postponing Ord dividends, the latest being banks in the Lloyds banking group tonight, is this practice/ can this practice be extended to pibs, and other fixed intrest instruments ?? Any thoughts or suggestions

arjungaur

Legally, somebody would have to read the fine print for force majeure or something, morally it's the right thing to do to help protect the vulnerable at the cost of capital providers

dandigirl

colin: having trashed huge chunks of our manufacturing and service industries, HMG is now setting about trashing the finance sector. This lot do not have a clue and have not even begun to think of the consequences to those who rely on income from bank paper. Bailey already dancing to the tune being played by the Treasury. Strewth!

locustspicy

Payments for AV.B, RAVP due on 31/3/ and GACB, RSAB and STAB due today, all paid in full. So far, so good. Fingers crossed.

arjungaur

Democracy/Capitalism and thus HMG are pretty terrible system except all other alternatives are even worse, and yes we have tried all those oligarchy, autocracy, anarchy, monarchy, commy et al.

UK had elections just few months ago, and British Public in it's infinite common sense chose BoJo overwhelmingly, too bad that this lot do not have a clue, so now you can fight or flight

Bailey is obviously in the pocket of administration, he'll do as he's told if he wants to be knighted after his BOE stint, instead of suffering like this don quixote - https://en.wikipedia.org/wiki/Sajid_Javid#Resignation_as_Chancellor

colin

International personal finance the latest to can cell dividend payments l.Lets hope it doesn't affect the 6.125% bond due to mature in May.

arjungaur

https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/IPF/14486177.html

Like the dividend, they should invoke force majeure or something and extend out the maturity of ipf1 for maybe 6 months, no point in killing the business completely just to use up precious cash to meet obligations to only one set of stakeholders, there are lot of other people involved in this group in lot of other ways. Cash, expenses and debt obligations are a top priority for any person or business to survive through this -

arjungaur

On a related note, it make total sense now why these retail charity bonds had the maturity extension option with 1% penalty coupon, i guess the investment bankers had seen prior instances of such financial panic say in 2008 where maturity extension of 1-2 years would have meant the difference between a collapse of business and a successful panic navigation -

dandigirl

Enough of your asinine, vacuous, irrelevant postings. I'm off. And please do not pm me again!

arjungaur

asinine, vacuous, irrelevant > Emotional Pressure > Decreases Performance

I'm off > Breaking Your Inertia as you were not enjoying > Increases Performance
do not pm me > Breaking Your Inertia as you were not enjoying > Increases Performance

arjungaur

asinine, vacuous, irrelevant > Blindspot Barrier

I'm off > Ego Barrier
do not pm me > Ego Barrier

Ego Barrier > And because our need to be right can be more important than our need to find out what's true, we like to believe our own opinions without properly stress-testing them. We especially don't like to look at our mistakes and weaknesses. We are instinctively prone to react to explorations of them as though they're attacks. We get angry, even though it would be more logical for us to be open to feedback from others. This leads to our making inferior decisions, learning less, and falling short of our potentials - https://www.principles.com/principles-for-success

Blindspot Barrier > The second is the blind spot barrier. Everyone has blind spots. The blind spot barrier is when a person believes he or she can see everything. But it's a simple fact that no one alone can see a complete picture of reality. Naturally, people can't appreciate what they can't see, just as we all have different ranges for singing, hearing pitch and seeing colours, we have different ranges for seeing and understanding things - https://www.principles.com/principles-for-success

arjungaur

Laughton

Santander 10.375% prefs payment received today.

arjungaur

GSHT paid out last week, AGT1 offered at 103.25, duchess is in demand : )

colin

Yorkshire building society pib paid today, northern electricity 8.06% also paid out

arjungaur

Notwithstanding the Group's financial and liquidity position, the Board has decided that in light of the uncertain macro outlook they are no longer recommending a final shareholder payment of 7.1 pence per share in respect of 2019, equivalent to a further £137 million.

https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/RR./14492066.html

Laughton

Plenty more to follow - although this site is really aimed at fixed income.

arjungaur

Yeah we have had plenty of discussion on this site's play, purpose and potential vs emotional pressure, financial pressure and inertia -

arjungaur

BUR2 paid out today, AGT1 offered at 105.65, duchess in demand : )

Couponcopia

To date, I observe from my portfolio, all expected have paid out:

Santander 10.375% non cum pref paid out 6/4
Natwest 9% paid out 16/4
Bristol and West paid out 15/5
Tesco Personal Finance 5% 2020 paid out 21/5

June will be the big month ... or not as the case may be. We will see what happens for :
Aviva 8 3/4
ELLA 8.625%
LLPC 0.25%
CDDS (Nationwide Core Capital Deferred)
Principality 7% (callable 2020)... I see from other thread it has been called

If anyone has any firm news on these for good or ill, please guide my thoughts...

arjungaur

If there has been no problems till now, then probably Jun will be uneventful

shaunm

They should be ok for the coupon

colin

Principallity 7% pib called today and all paid into my account. Will miss it, it's been a good hold over several years for me

arjungaur

https://www.bailliegifford.com/en/uk/individual-investors/funds/scottish-american-investment-company/ic-article/2020-q2-the-great-dividend-crisis-pro-ar-0084

colin

Good common sense article

Couponcopia

FYI, LLPC (Loys Nun Cum Irr Pref 9.25%) credited 31/5 OK.

arjungaur

Baillie Gifford has got some good ideas, their holdings in the following had caught my attention initially

https://www.londonstockexchange.com/stock/SMT/scottish-mortgage-investment-trust-plc
https://www.londonstockexchange.com/stock/USA/baillie-gifford-us-growth-trust-plc

Couponcopia

FYI this post argues that Nationwide CCDS will payout (due later this month), for reasons of being closer to debt than equity, and to maintain good relations with the debt market for future issuance. https://twentyfouram.com/2020/03/30/ccds-should-escape-payout-suspensions/ [
You may need to use MS Edge as I get a browser error in Chrome on this site. ]

Also since that post, it emerges that UK consumer debt has hugely decreased during the crisis (https://www.independent.co.uk/news/business/news/credit-card-loan-debts-paid-off-coronavirus-lockdown-a9544241.html), which on face of things will not decrease Nationwide performance in future stress tests.

Also, I observe price seems utterly stable at 164

Proof of pudding, will be seen later this month.

Edit: Off-topic but this article on their site, sums up post-COVID trends into specific FI strategy recommendations: https://twentyfouram.com/2020/04/27/investors-could-face-another-decade-of-income-scarcity/

arjungaur

I wasn't getting the browser error in Chrome for this site, maybe you have to update the Chrome to its latest version or update the operating system

not sure about 164, is it like a callable instrument with a ceiling of 164 or maybe some big seller at 164

thank you for these twentyfouram.com links, I was on look out for high quality research material that I can use to help new users understand the financial markets better : )

colin

yes,agree this is a good site with some excellent knowledgeable material, well worth exploring

arjungaur

But in aggregate, if you look at them, the cash flow stream from that type of company, it tends to be a fairly steadily climbing accumulation of cash flows, which gives you the possibility of creating something like a new asset class that could potentially be a bond alternative. And this is something that we're playing around with.

The Mechanics of the Economic Flywheel and Pandemic Investment Outcomes