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- Manlobbi
Investment Strategies / Non-US Stocks
No. of Recommendations: 1
In the interest of diversification I've been exploring other markets and ANZ holdings, a New Zealand bank, came up. Been around since the colony was founded in one form or another. Several recent purchases of other NZ banks and currently holds ~30% market share. Decent dividend if you like that sort of thing. They've gotten themselves in hot water for their capital requirements. From the wiki page:
A Deloitte review found that "a historically complacent approach, the absence of a comprehensive compliance plan, diffused accountability and inadequate assurance processes, all contributed to the operational risk capital breach not being identified for more than five years". Huh. They seem to have a bad reputation with their customers (e.g. higher floating mortgage rate than thier competion) which may be good for stockholders?
Anyone have eyes on this one?
Rgds,
HH/Sean
No. of Recommendations: 2
A) In the interest of diversification I've been exploring other markets and ANZ holdings, a New Zealand bank
ANZ Bank ("Australia New Zealand Bank") is not a Kiwi bank, but as their name says a Australian & NZ bank. In NZ (probably/maybe in Aussie too) it's the largest one, followed by BNZ Bank.
B) They seem to have a bad reputation with their customers
Not in NZ. I was their customer in the 90s, my Ex is their customer since 2015. All good apart from once when she transferred money from Germany into her ANZ account being heavily overcharged by them using a 2% too low exchange rate. We complained to the Banking Ombudsman and ANZ quickly caved in, crediting 1.5% or so of those 2%.
This alone btw is not anything giving ANZ a worse reputation than any other bank, as they all have that "habit". Next year we did it the other way around, letting her German "comdirect" bank exchange the EUR into the then into her ANZ account transferred NZD. comdirect", daughter of one of Germany´s oldest and most reputable bank, overcharged (additional to their fees) even by a 2.2% lower exchange rate than the then exchange current rate of the ECD (European Central Bank) --- and our complaint at the German Banking Ombudsman, proofing the overcharging with detailed numbers and calculations, was greeted with a standardised reply essentially saying "... contract between comdirect and customers allows comdirect to use any exchange rate"). It was clear proof who the German Ombudsman works for and is paid by (the banks, not the customers).
C) In the interest of diversification I again have money in NZ. This time at BNZ bank, but only because my Ex (still good friends) as said has an ANZ account = to also diversify between banks. Otherwise I would without hesitation had an ANZ account.
No. of Recommendations: 6
A very much more general observation is that it's usually not a great idea to hold a meaningful position in a bank you don't truly know and understand really well. Which in turn requires the ability to really understand banks, which is a rare skill. I don't have it, but at least I have learned (sometimes painfully) that I don't have it.
Banking is a great business if you merely avoid doing stupid stuff, but the problem is that bank managers are as likely to do stupid stuff as a kid is likely to eat candy. And you never know till after the fact.
The great majority of the time the stupid stuff is lending to people who can't pay it back (and which was probably obvious at the time), most likely against property which is cyclically overvalued. So in theory you can avoid a few problems by not investing in the "high" part of the cycle. But every cycle seems to include a brand new way of doing stupid stuff. Right now we seem to be in that part of the cycle that it has been long enough since a banking crisis that the banks are lobbying, mostly successfully, to weaken the rules put in after the last one.
Other than a couple of specific exceptions, I don't do banks except when it's a small position as part of a diversified "shotgun" portfolio.
None of that is to suggest that banks down under won't do well for you, just a general health warning to consider.
Jim
No. of Recommendations: 0
Banking is a great business if you merely avoid doing stupid stuff
So ixnay on the ankbays? Got it.
Hard to identify the major industries. I guess Kiwi wines are a thing, but tariffs may cut their popularity in the US. (BTW I saw that US wine imported to Canada is down more than 90%. Whoda thunkit?) Phosphate mining? Healthcare? Is it still true there are more sheep in NZ than people?
Needs more study.
Rgds,
HH/Sean
