Is anyone else thinking of investing in the Banks long-term?

Glacier

I'm sure this has been asked before but is anyone else seriously thinking of investing in the Banks long-term once everything settles? Now that the Toxic Bank thing is the way the Government wants to go, if in 6 months this seems to be working & nationalisation becomes less likely is there not huge potential to clean up in the long run? And would anyone seriously be prepared to do this?

thirtythirty

Glacier wrote: »

I'm sure this has been asked before but is anyone else seriously thinking of investing in the Banks long-term once everything settles? Now that the Toxic Bank thing is the way the Government wants to go, if in 6 months this seems to be working & nationalisation becomes less likely is there not huge potential to clean up in the long run? And would anyone seriously be prepared to do this?

Did it already 2 months ago when AIB was @ 40 and BoI was @25 cents. You'll never get another opportunity like this. If you have a bit of expendable cash it's probably the best gambling opportunity that will present itself in your lifetime.

It's very hard to try and ignore and not cave into making a quick bit of cash. I nearly sold when they were at €1, but i've got over that initial "Maybe i should sell now and re-buy when they drop again" buzz and am in it for a few year's long-haul.

Cantoris

Even if NAMA takes the loans it will be for a big discount (or it should be) and the banks will have a large hole in their reserves to be filled by Ireland Inc injection. How much of a stake that will give Ireland Inc is open to question and until it is clear there will always be volatility in the share price. Why not wait until the waters clear, NAMA has taken the loans and you can see what hole is left. If you then believe that you know what Ireland Inc will have to put in and think it's less than the market believes, then buy then. Or even wait until Ireland Inc has put in the capital and see how things go. It's still a risky gamble at the moment but it should be clearer in three to six months and plenty of time thereafter to make money.

To me, it's a question of trust.

Do I trust them? No, so I won't be gambling/'investing'.

Will I rue the decision? No.

If you have to invest in a bank then you should probably choose one that does not have a history of incidents like some of the Irish ones do. If their résumés over the last 20 years did not include things like overcharging, misselling, BNRs, Faldor etc. etc. I might have a different opinion.

thirtythirty

On one hand you make good points. On the other hand f*** it!
My attitude is throw the money at it, close your eyes, and in 4 or 5 years if the shares are worth even a quater what they were, that's 20 or 30 G's for me!

Time Magazine

http://www.boards.ie/vbulletin/showthread.php?t=2055541156

If the government take the advice of several well-respected economists, people who have invested in banks will lose 100%.

ranger4

The Economist wrote: »

http://www.boards.ie/vbulletin/showthread.php?t=2055541156

If the government take the advice of several well-respected economists, people who have invested in banks will lose 100%.

Since when as this gov ever respected and acted on good advise, They will pursue their own agenda untill forced out of office, which will happen sooner than people think leaving the door open for fg-labour to fully nationalize the banks.

Idu

Glacier 4/12/2008 - Does anyone see the this as the greatest opportunity of the last hundred years to make serious money? I would have €40,000 soon, would I be crazy to invest €30,000 or so in Irish Bank shares as a once-off opportunity to really make money? At one stage BOI was €18 not it's one something. If in 5 years it's only half what it was then, you could still make 6 or 7 times your money, right? BOI can't be allowed to collapse though. I know we're heading into a major recession, it's been said though that the Great Depression didn't even last 5 years. Does anyone agree?

http://www.boards.ie/vbulletin/showthread.php?p=58141963#post58141963

Only had to wait 4 months for you to ask the same question again. What's changed since then? If anything the outlook is worse now

daveirl

This post has been deleted.

holly1

nearly invested in BOI a couple of months ago,I think Im happy I dident.Was I right???

Glacier

Only had to wait 4 months for you to ask the same question again. What's changed since then? If anything the outlook is worse now[/QUOTE]

At least now you know what the Government's strategy is, at least they want to go with NAMA, if it fails then nationalisation is still a possibility but what if it works?

pjma

Why Why the banks, there are so many other better stocks to buy at this point in time.. anyone buying the banks has to view it as a punt.. I think many people are looking back thinking wow Aib traded at around E20 in the past.. Unfortunately, we are in tougher times and the stock market is a leading indicator. Nevertheless, its quite exciting watching them tank every few days.

Glacier

It may take time to settle but what do you think in the long run?

AARRRGH

I think it is too risky. I can't see how NAMA will solve the problem for the banks. By forcing the banks to admit to their bad debts, and then buying those bad debts cheaply off the banks, the banks will be left with a big hole on their balance sheet. This will require another bailout, which very well may cause them to be nationalised.

Personally I would stay away from the banks. Maybe day to day gambling is fine, but long term, nope!

A Random Walk

Glacier wrote: »

I'm sure this has been asked before but is anyone else seriously thinking of investing in the Banks long-term once everything settles?

I'd describe it as gambling, not investing. There are so many other cheap and solid companies out there with reasonably predictable future returns that I don't feel the need to risk my money on what is essentially a bet. Worse, it's a bet where I am dependent on unpredictable actions from governments and politicians.

ingmarbueb

i congatulate the guy who bought aib for 40 cents and went long,good for him.i am in at 86 cents and go long.nationalization is off the table ,bottom was reached,the same for the dow.i think this bank is 95 percent safe to survive and will bloom again.in 4 years i will be millionaire.once things are 100 percent certain the price will be 3 euros.whats the point waiting till then.i think it will creep upwards from here.i am sure the stockprice from now will be ten fold higher in 4 years.

AARRRGH

ingmarbueb wrote: »

nationalization is off the table

Why do you say that? Every piece of data out there at the moment suggests nationalisation is nearly guaranteed to happen.

ingmarbueb wrote: »

bottom was reached

Not a chance. We are still at the beginning of this mess.

ingmarbueb wrote: »

i am sure the stockprice from now will be ten fold higher in 4 years.

Based on what evidence? Give me something tangible, not gut feeling.

stainluss

Glacier wrote: »

I'm sure this has been asked before but is anyone else seriously thinking of investing in the Banks long-term once everything settles? Now that the Toxic Bank thing is the way the Government wants to go, if in 6 months this seems to be working & nationalisation becomes less likely is there not huge potential to clean up in the long run? And would anyone seriously be prepared to do this?

Yes, i already have.
Im not saying to bet your rent or insurance money, but if you have savings i would put a fair % on aib and boi if your prepared to wait 2yrs.+ and in time, if the banks arent nationalised, you could expect very nice returns.
I would reccomend the sharewatch under 15000euro worth of shares with a 50euro charge to buy/sell.
Thats it! No other charges:D
Good Luck:pac:

stainluss

ingmarbueb wrote: »

i am sure the stockprice from now will be ten fold higher in 4 years.

If nationalisation doesnt happen, id expect them to be at around 6/7 euro by then

pocketdooz

stainluss wrote: »

If nationalisation doesnt happen, id expect them to be at around 6/7 euro by then

Aren't you the same person who asked on another thread for someone to explain what a stockbroker and stocktrader was?

Where did you pluck the 6/7 euro figures from?

The wonders of this forum never cease.

Glacier

I think it will take time to see what whether NAMA will work. If in six months it seems like this is the way it's going & nationalisation is off the table would that be the right time. In the short term though there seems to be a lot of money to be made with the markets as volatile as they are. How long more do you see the uncertainty lasting before we will have a clear picture of they way things are going to go?

ingmarbueb

my opinion is not based on real facts,nobody knows those.i think the dow jones has bottomed at 6400 and will go back to 12000 the next 4 years until a new recession will hit us.i think we are in a long bearmarket like between 1929 and 1949 ,less severe and a bit shorter,i expect a bullmarket for 2017 to 2030.we are at the beginning of a huge bearmarket ralley.the 6400 point bottom is comparable to the 41 bottom in 1932.back then you had a ralley from 1933 to 1937.AIB has bottomed and is on the verge to become profitable again especially when they sell their crap polish stocks that don't have much future anyway,and raise their tier 1 to write profits again.THE US government is leading us out of this mess and will drag old pow Ireland along.people will suffer another 2 years from here,not the DOW.The medias have created too much fear,it is unreal.My feeling,instinct and analyses tells me this is the way to go.AIB.Citibank might be a great long play too but it is not as cheap and riskier.practically any stock is a good long play right now but then you get a 2 or 3 bagger,i want a 10 bagger.Best Ingmar.

Économiste Monétaire

Nationalisation is 'off the table'?

pocketdooz

ingmarbueb wrote: »

my opinion is not based on real facts . . .

Enough said

AARRRGH

ingmarbueb wrote: »

my opinion is not based on real facts,nobody knows those.i think the dow jones has bottomed at 6400 and will go back to 12000 the next 4 years until a new recession will hit us.i think we are in a long bearmarket like between 1929 and 1949 ,less severe and a bit shorter,i expect a bullmarket for 2017 to 2030.we are at the beginning of a huge bearmarket ralley.the 6400 point bottom is comparable to the 41 bottom in 1932.back then you had a ralley from 1933 to 1937.AIB has bottomed and is on the verge to become profitable again especially when they sell their crap polish stocks that don't have much future anyway,and raise their tier 1 to write profits again.THE US government is leading us out of this mess and will drag old pow Ireland along.people will suffer another 2 years from here,not the DOW.The medias have created too much fear,it is unreal.My feeling,instinct and analyses tells me this is the way to go.AIB.Citibank might be a great long play too but it is not as cheap and riskier.practically any stock is a good long play right now but then you get a 2 or 3 bagger,i want a 10 bagger.Best Ingmar.

When NAMA forces AIB and BOI to admit to massive bad debts, what do you think will happen?

rugbyman

Hello AAARGH

One thing i like about life is that I am continually learning, and the more i read of peoples opinions ,the more i am likely to learn. there is always another viewpoint.

A.
Your post on this thread no 14 is reasoned and logical.
Assuming the head bankers are not completely stupid, they also will know what you have said and will not walk blindly into the situation( of needing further state help ,having sold their bad debts at a fraction of their nominal value) thus ensuring virtual nationalisation,
UNLESS they reckon it is in their own(sadly,possible) or their shareholders interest.

B
re your next post, replying to INGMAR,

Quote
Every piece of DATA out there at the moment suggests nationalisation is nearly guaranteed to happen.

Could you expand on that a little. I have read dozens of articles and posts but they are peoples opinions

C
Originally Posted by ingmarbueb
bottom was reached

your reply, not a chance.


simply two conflicting personal opinions here ( nothing tangible here)




D
Give me something tangible !

A lot of people come on here and query others opinions. many people have an opinion,, which are based on nothing other than gut feeling. They all turn out to be either right or wrong, or some shade of either of those.

Might I ask you to post some thing that you think might happen, and give some tangible reasons.

I have re read this in search of anything personal or negative and found nothing. I hope it reads the same way to others.

Regards ,Rugbyman

battser

I am in the same boat as a lot of people on this. I am not a financial expert and I know just about as much as the next person and that is that we are gonnabe Fooked for a while.

My point however is directed at people thinking of investing in the banks.

Today Eamon Ryan announced that the government "WILL" be pumping more money into the banks. This would suggest that the trouble we see the banks are in now is not half of what they really have gotten themselves into.

Personally I was going to put a lot of money into BOI but have decided against it. The banks and people running them and ministers involved with them are what we can all agree on - LIARS! And personally I believe this wont ever change. So no matter what anyone on here says or thinks not one person even the ministers or banks know what is coming next.

I am still going to put a few k into BOI when it drops which it probably will, which leads me and just my opinion to believe that AIB nor BOI will be nationalized. As things are just too unstable however I am clever enough to know that mine and others opinions can be wrong and this is the reason I wont invest a big sum into them. The risk is still too Great No matter how many people think they wont go down the toilet.

I am willing to take the risk involved on a small amount of cash but thats just me.

The Question is. Can you risk losing 10k of your hard earned cash?

Idu

battser wrote: »

The Question is. Can you risk losing 10k of your hard earned cash?

No the question is why would I tie up 10k of capital in a stock with so much uncertainty when I could invest in so many other areas, markets, sectors etc etc. The banks are not the be all and end all. There's loads of great value in the market at the moment

gnxx

I would bet money that the banks will be nationalised. The question is when will this happen. The most probable case is soon after NAMA taking on their loan books. NAMA is at least 12 months away in my view.

My concern is that institutional and larger investors will bail out quickly once they hear whispers about nationalisation, leaving the average investor holding worthless stock even before nationalisation takes place.

AARRRGH

rugbyman wrote: »

Could you expand on that a little. I have read dozens of articles and posts but they are peoples opinions

Hi Rugbyman

Well, my opinions are just opinions too

I could be wrong, and of course if you buy bank shares now you could make a killing in a few years, but we already know the people running the banks (nevermind the politicans!) are incompetent, so I wouldn't be quick to trust their judgement now. It is quite likely they don't have a clue what they're doing. Recent history certainly suggests that's the case anyway!

How will NAMA not make a huge hole in the bank's balance sheet? The only answer I have for this is if the banks lie and pretend their debts aren't so bad.

gears

Nationalisation or effective nationalisation are two very different things. Personally I'm leaning more towards effective rather than all out and one recent announcement is moving me more in that direction.

Taking the view that many if not all Irish pension schemes have a large portion of their funds in Irish banks as they were historically seen as a safe haven, I feel that the political fallout plus the fact that the government may be forced to bail out or prop up pension plans, as was announced recently, will lean the government away from wiping out the value of these stocks.

Just a personal opinion.

Idu

I would have thought that most pension funds would have dumped their banking stocks once they stopped paying a divindend

AARRRGH

gears wrote: »

Taking the view that many if not all Irish pension schemes have a large portion of their funds in Irish banks as they were historically seen as a safe haven, I feel that the political fallout plus the fact that the government may be forced to bail out or prop up pension plans, as was announced recently, will lean the government away from wiping out the value of these stocks.

Interesting, our Government does have that sort of mentality.

daveirl

This post has been deleted.

pocketdooz

Idu wrote: »

I would have thought that most pension funds would have dumped their banking stocks once they stopped paying a divindend

you are right

ranger4

daveirl wrote: »

This post has been deleted.

True but if not delisted and given a couple of years we could easily see aib-bkir back in profit. Dermot desmond suggested letting nama house and sell bad debt when market conditions recover and not too force banks to take huge writedowns with bad loans helping to keep exsisiting capital in the banks, this plan would create confidence with new investors and help boost badly needed capital for our banks.

daveirl

This post has been deleted.

ranger4

daveirl wrote: »

This post has been deleted.

I question the need for Levy, If bad Loans are housed untill market conditions recover in 5-10 years im sure they will make a overall profit on thease loans, i feel the gov should look & listen carefully at what dermot desmond is saying.

pocketdooz

ranger4 wrote: »

I question the need for Levy, If bad Loans are housed untill market conditions recover in 5-10 years im sure they will make a overall profit on thease loans, i feel the gov should look & listen carefully at what dermot desmond is saying.

How will they make a profit on these loans, exactly?

Seriously.

woodseb

ranger4 wrote: »

True but if not delisted and given a couple of years we could easily see aib-bkir back in profit. Dermot desmond suggested letting nama house and sell bad debt when market conditions recover and not too force banks to take huge writedowns with bad loans helping to keep exsisiting capital in the banks, this plan would create confidence with new investors and help boost badly needed capital for our banks.

of course Dermot Desmond is an impartial observer in this :rolleyes:

he is talking his own book on the matter

ranger4

woodseb wrote: »

of course Dermot Desmond is an impartial observer in this :rolleyes:

he is talking his own book on the matter

I guess reason for gov to listen to mr desmond could have something to do with him being one of irelands most successfull buisnessman and has a good point with present gov plan strangling the exsisiting capital out of aib-bkir, surely there has to be a better plan which doesnt involve delisting and going cap in hand down the road to the IMF.

RoadKillTs

I sold day of the Budget. Tbh I would like to have the balls to stick with them because at the end of the day if they were to escape been nationalised then you would be looking at a prity big return.
For me though it's too volatile at the moment to risk so I took the profit while I could.
A small profit

pocketdooz

RoadKillTs wrote: »

I sold day of the Budget. Tbh I would like to have the balls to stick with them because at the end of the day if they were to escape been nationalised then you would be looking at a prity big return.
For me though it's too volatile at the moment to risk so I took the profit while I could.
A small profit

What is the rationale behind this? So many people on here have been spouting this crap for months? Why will you be looking at a big return?

As DaveIRL has said so many times, investing is all relative. Returns have to be compared to (i) returns of other similar assets over the same time period and (ii) the risk (standard deviation usually used) of that asset over your investment period.

Just because I made 20% on a stock I bought in 2002 and sold in 2006 doesnt mean I'm a good investor if I made less than the overall market and had considerably more risk/volatility because my portfolio was one stock, not the whole market.

You need to factor in things like the inflation rate, interest rates, the time value of money, the opportunity costs of money, transaction costs, volatility etc before you can even begin to look at whether something is/was/will be a good investment.

Personally, I would not be happy with anything less than a 100% p/a return on an investment in the banks now for 3 years because of the risk involved. I don't think they will achieve anywhere near this.

EyesLeft

Has anyone been watching AIB and BoI shares trading in the US; while the Irish markets have been closed there has been a huge jump, 15% today and a smaller but sizable jump on Friday.

rugbyman

hello Eyes left

i noted your comments last night and checked the US figures. you were indeed right.

So i wondered how to profit from this. Some posters on here had identified a good system , when US rises , buy here next day and sell before lunch ( as I recall).

So this morning , because of the 20 min delay I could get no info as to the irish sp untill 8.25, by which time AIB had risen 6 pence and BOI 14 pence, too late for me to get on i reckoned.

Si I thought,
sell the ones i own now,BOI @ 92 pence, in the belief that they would fall. i did not do this and they have fallen slightly now.,10.30 am. 89 cent. the number of shares i have (3,000) means I ned a fall of ten cent to allow me to sell and buy back.

Quite a number of opinions , one on here and others elsewhere forecast that
share prices may/will fall in may, so i should embark on my venture to profit on the way down.

Who knows, Rugbyman

thirtythirty

The Economist wrote: »

http://www.boards.ie/vbulletin/showthread.php?t=2055541156

If the government take the advice of several well-respected economists, people who have invested in banks will lose 100%.

Pfff..bunch of academics with too much time on their hands to theorize and try to make an argument to counter the government's plans. Nobody would take notice of them if they were agreeing.

I'm going to base my opinion on people who are actually in the business and financial world such as dermot desmond and the following:

"Gervais Williams, the investment guru at British firm Gartmore, who has consistently beaten the ISEQ since he started picking Irish financial stocks in 1995, has piled back into banks in the belief they will not be nationalised.
The Welshman's Gartmore Irish Growth Fund, a listed plc, has been buying financials for the past few months and the sector now makes up 15pc of the total portfolio.
Speaking to the Irish Independent yesterday, Mr Gervais said he expected the two main banks to generate once-off profits and boost their capital base by buying back some of their "hybrid" debt, which is trading at a discount in the markets. He was in Dublin for the annual 'IR Magazine Ireland' investor relations awards.
Allied Irish Banks and Bank of Ireland have about €6bn of hybrid debt in their balance sheets -- made up of non-core tier-one and tier-two debt -- which is trading much more cheaply in the market compared to the value they are carried on the banks' own books.
By buying this debt back at a discount, the banks could book the difference as pure profit and, therefore, boost their capital bases.
Analysts estimate this could generate between €600m and €1bn for each of the banks, depending on what level of debt holders take up such an offer.
While influential UK stock picker Anthony Bolton, president of investments at Fidelity International, said yesterday that a bull market in equities had begun, Mr Williams said he believed the latest gains were down to a "bear market rally"."

Idu

i think my eyes are bleeding

rugbyman

Well i did it. sold at 93 cent ,and they continue to rise.
got that wrong, for the moment.
shoulda, oughta,woulda

very little on here lately, everyone on holiday ?
Rugbyman

gears

Maybe everyones too busy buying and selling...

But whats the deal with banks at the moment another 20% rise so far today. I'm in with BOI and AIB myself and bought them for the long haul hoping for some stabilisation over the next year, but these wild fluctations and massive day to day jumps do test the nerves.

ch750536

Although I see no real reason why BOI fell other than they were in Ireland, this rise is unexpected for me.

I sold at 94, bought at 37. Am happy with that regardless.

Daragh101

ch750536 wrote: »

Although I see no real reason why BOI fell other than they were in Ireland, this rise is unexpected for me.

I sold at 94, bought at 37. Am happy with that regardless.

happy days, where else would you get a return like that, bought at 56cent myself hoping to sell this week!!!:D