What did that Standard Bank trading statement say

b>What did that Standard Bank trading statement say to send the bulls in the opposite direction? This is what they said: "Shareholders are advised that Standard Bank Group's earnings per share, headline earnings per share (HEPS) and diluted HEPS are expected to be between 3% and 12% lower than the same earnings figures for the year ended 31 December 2009....."



For the full year 2009, "normalised EPS was 757 cents per share, down 20% on 2008". So, in the middle of the range down 7 percent, we are looking at a little more than 7 Rands a share worth of earnings. And with two and a half times dividend cover, shareholders would have to expect less than 300 cents worth of dividends. So, next question? Do you pay 101 ZAR for a bank that is on a historic (well nearly) 15 times earnings multiple and less than three percent yield? Of this size and scale?




Perhaps the only bank with a reality check of sorts locally, or being too aggressive on the cost cutting exercise? I would like to think that Standard Bank of the major retail banks is always slightly ahead of the curve. Which begs the question, what are the other banks thinking right now? But I guess the next big question to ask, in light of shaky banking systems around the world are seeing banking assets sought elsewhere in the world. And elsewhere in the world means here. So, a three percent yield from a stable emerging market bank like Standard Bank, with good prospects, if not for the moment, is still compelling. Perhaps a market underperform for the next 12 months, but after that......