RBS Shares

calash

Just wondered does anyone have any feel on what's going to happen with the RBS shares??? Help needed:eek:

amcluesent

Why would they go up? No divi and the organisation run by Sir Humphrey. It'll make the railways look efficient.

calash

I need to try and be positive, how long do they think it will take to get the shares up if ever??

sabretoothtigger

Short term:
Till all new shares are issued and the market is no longer threatened with 120% more shares being floated at 65p. Not sure what the time frame is, jan 09 ?


Long term:
Till they repay the preference shares apparently which is as long or short as their profits dictate, then they can pay a dividend

They have 5bn to pay off , who knows maybe a year or maybe 5 or more. I think they are discounted heavily and will pay it off ok but who knows





http://www.investors.rbs.com/investor_relations/index.cfm

The Offer is subject to shareholder approval and further details and the terms and conditions of the Offer will be set out in the prospectus which is expected to be published in late October 2008. The Offer is expected to close in November 2008.

anna42hmr

thats something i would like to know too, i'm just holding tight at the moment and watching the share price, especially with the new "rights" issue

not too happy about no divis but you never know, if certain areas of rbs are sold as hoped (ie the insurance arm) then maybe the government will be paid back quicker restoring the divi's

you may want to read this thread too http://forums.moneysavingexpert.com/showthread.html?t=1223101 as several people have been wondering and discussing the same

[Deleted User]

I sold all the bank shares in my dh`s sipp. I bought shares in solid companies that are more likely to rise in value.

equitydealer

I'm down 50% on RBS and have resigned myself to holding on to this for a few years.

Recovery will occur but it will be slow. Things will probably get worse first though, therefore not brave enough to buy more to average down quite yet!

itsmickdundee

calash wrote: »

I need to try and be positive, how long do they think it will take to get the shares up if ever??

Not even god would know that. Anything could happen, all you or anyone else can do is make best use of the information at hand to influence your speculative guess.

Once we are confirmed to be in recession by year end, I expect another drop in the world markets.

I'm guessing the markets will be going sideways for quite some time, before slowly picking up again in 2010-2011. I'm guessing a full recovery will be underway by 2013-2014.

Regarding banking shares. RBS has had dividends suspended for five years. This instantly makes it unattractive to investors. Hence, lack of buying = a drop in share price. Shares (generally) work by supply and demand.

I therefore expect RBS shares to drop slightly over the next few months (also due to recession and CDS defaults) and then stay on a relative sideways pattern for the next few years, with the odd spike here and there. This is logical considering the dire state of the banking system and lack of divis. Once divis are paid out again by 2013, then the share price will begin to properly recover. It will also coincide in the upturn in world markets - which will have a lot to do with a much healthier banking system. However, it could take a decade or even longer to see bank SP's back to where they were at there peak circa 2007/08 - remember a lot of value in their share price was from profits (and money) which never actually existed.

With tighter regulations coming into play, making such claims will be a lot harder to do, and a big market correction (as has happened, especially in the banking sector) could take many, many years to recover from and reach the previous highs of a few months ago before all the s**t hit fan...

Otherwise, you could just write the loss off. After all, surely that is something you accept if you are going to trade on the stock market?

sabretoothtigger

Not five years, the preference shares are a five year term but can be repaid early then you would get dividends on all the other shares

Selling this for solid stocks would be good except they havent halved in price so cant double back, I'd rather move the money sideways to standard chartered who have dropped 60% but have more money on deposit then lent out, increased their profits 30% this year over last, increased their dividends and other fine fundamentals.
Also browns plan was formulated by standard chartered

mrposhman

It all depends on the prospective buyers. There are those who are after dividends and those after capital gains.

Obviously if confidence in the price and therefore valuation of the business doesn't rise then the rights issue will push the price lower but more cash means more assets.

Also if you look at the valuations of the insurance arm (apparantly 51% will be sold for £3bn) then this would value the insurance arm at £6bn which makes the group valuation of £9bn look very small. The shares will go up but its anyones guess when.

I think all banking shares are completed undervalued and will increase over the next year.

I've said in another thread I would expect a lot of writeoffs before their year ends but this will enable a return to profit (hopefully!) next year and then there will be a return to a nice earnings per share figure which will hopefully raise the share price.

I bought at 60p per share so I did quite well, though I feel really sorry for those who bought at the last rights issue as I'm not sure it will be any time soon that you will see a return.

cbobting

itsmickdundee wrote: »

Not even god would know that.

i dont know, he did mention something about it on his blog.

http://www.bbc.co.uk/blogs/thereporters/robertpeston/