Provident Financial debt has become interesting

[Wozzitworthit]

After posting the above, I went for a walk and mused over what I had said ...

Maybe I should be thinking of selling ! - with the cost of living rising (full effect yet to be felt I reckon) presumably there may well be an increase in the number of people unable to make their repayments

Woz

[88V8]

Sell half. That way you will only be half wrong.

I think the Enquest pik ENQ1 would not be a bad parking place. Provided one keeps them long enough for the divi to eat up the spread.

V8

[Wozzitworthit]

88V8 - thanks for reply

Yes, I may well do that, having become even more concerned about how some of the lowly paid workers are going to cope in the coming months - there's only so much you can do by turning off lights, (assuming you still have the old tungsten ones, otherwise it'sonly a gesture)

Enquest - yes I have alredy piled money into those - may get more
.
Last time inflation was in double figures I was working and to be honest didn't notice a huge effect - however, bank deposit accounts in those days paid interest , if I recall, of only 2 or 3 percentage points below inflation (for term deposits at least)

Woz

[Clitheroekid]

Sell half. That way you will only be half wrong.

I always think that's the worst possible decision. If the stock rises after you've sold you're annoyed that you didn't hang on, and if it falls you're annoyed you didn't sell the lot!

[hiriskpaul]

2021 Results: https://www.londonstockexchange.com/new ... t/15391777

They look fine to me, but something has upset the share price (down 6%). Bonds unmoved.

[hiriskpaul]

Just topped up 30k of the 5.25% maturing in October for 98.019. Short term trade, but with a YTM of 9%!

FY results due tomorrow. Fingers crossed!

[Surerera]

I did the same myself yesterday, 9% looks a bargain to me.

[hiriskpaul]

Very strong FY results today prompted me to buy another 70k. Had to pay more though, 98.536, for a YTM of 8.1%. Still much better than I can get on cash and about 1.5% of the 4.1% gain is tax free.

Vanquis are awash with capital. We are not likely to see any more senior unsecured being issued for some time, with both outstanding bonds being repaid this year, replaced with deposits. For those who can access them, the T2 bond looks like a bargain. Unfortuneately I have not been able to persuade any of the retail platforms I use to list it.

One interesting remark is that they are intending to optimise their capital by issuing AT1! I think that aspiration may have been delayed...

https://www.londonstockexchange.com/new ... t/15899010

[hiriskpaul]

Provident retail bonds last gasp - one remaining senior unsecured bond available to retail investors.

I just bought a few more of the 5.125% maturing on 9/10/23 with cash that has accumulated in my SIPP. Price paid was 99.319. Profit on this purchase will be an enormous 0.8%, but that works out at a 15.6% rate of return. Much better than I am getting on cash at HL.

Short of a black swan event these will be repaid. If there was any intention not to repay that would have to have been announced by now and the half year report said that the £60m redemption had been "pre-funded".

Provident/Vanquis is a textbook example of when it pays to buy the debt rather than equity in distressed situations. Since my initial post 6 years ago the ordinary shares have lost over 80% of their value, but every bond has repaid on time and produced a profit.

Fingers crossed the same thing happens with Metro Bank

[simoan]

Provident retail bonds last gasp - one remaining senior unsecured bond available to retail investors.

I just bought a few more of the 5.125% maturing on 9/10/23 with cash that has accumulated in my SIPP. Price paid was 99.319. Profit on this purchase will be an enormous 0.8%, but that works out at a 15.6% rate of return. Much better than I am getting on cash at HL.

Short of a black swan event these will be repaid. If there was any intention not to repay that would have to have been announced by now and the half year report said that the £60m redemption had been "pre-funded".

Provident/Vanquis is a textbook example of when it pays to buy the debt rather than equity in distressed situations. Since my initial post 6 years ago the ordinary shares have lost over 80% of their value, but every bond has repaid on time and produced a profit.

Fingers crossed the same thing happens with Metro Bank

Nice idea! Now getting quoted 99.439p on HL for £5k worth. I had anticipated these being repaid next month but will leave buying more for now.

All the best, Si

[Laughton]

Barring a black swan suudenly landing these will pay out on Monday.

Could turn out to be quite good timing as FI seems to be falling off a cliff so some tasty yields on offer.

Any favourites?

[88V8]

Barring a black swan suddenly landing these will pay out on Monday.
Could turn out to be quite good timing as FI seems to be falling off a cliff so some tasty yields on offer.
Any favourites?

Plugging away at AV.A/B, GACA/B, ELLA, and now RSAB which I had forgotten, in hope/expectation of eventual tenders.

Albeit surprised at dearth of action while prices were at bottom. Perhaps the issuers are not too bothered, or hope that the FCA will agree to restore the eligibility of Prefs & PIBs.
Rather odd.

V8

[hiriskpaul]

Any favourites?

Metro Bank 9.139% 2025!

Possibly. But I will have a longer think. I am not particularly attracted to other FI opportunities or adding to positions i currently hold. Outside FI there might be some bombed out ITs on good discounts. Seraphim Space is one I occasionally think about, but there are likely to be others.

[88V8]

Any favourites?

Metro Bank 9.139% 2025!

Or are they now 2028?
Which might explain why they appear to yield c15%.

V8

[hiriskpaul]

Metro Bank 9.139% 2025!

Or are they now 2028?
Which might explain why they appear to yield c15%.

V8

Sorry, I meant 2028.

[simoan]

Barring a black swan suudenly landing these will pay out on Monday.

Could turn out to be quite good timing as FI seems to be falling off a cliff so some tasty yields on offer.

Any favourites?

First time I've held a bond to maturity so not sure how quickly the payment will hit my account along with the final coupon payment. I think the latter normally hits my HL account on the 12th. I will probably recycle into a Pref, most likely topping up my ELLA holding.

All the best, Si

[Laughton]

Anyone seen the maturity proceeds yet? Nothing so far at HL.

[Surerera]

Nothing from iDealing either

[88V8]

They were still live yesterday, perhaps they expired at midnight... anyway, bit soon to expect the dosh.

V8

[hiriskpaul]

Anyone seen the maturity proceeds yet? Nothing so far at HL.

No, but HL are currently showing our positions at 100 times nominal! I guess payment is imminent.