Top Dividend Stocks of Americas,Europe and Asia-Pacific

Posted by on

The Dow Jones STOXX Global Select Dividend 100 Index tracks the high-dividend-yielding companies in the Dow Jones STOXX Global 1800 Index that includes the Americas,Europe and Asia-Pacific. The 100 components in the index contains 40 stocks for the Americas and 30 each for Europe and Asia-Pacific.

The Dow Jones STOXX Global Select Dividend 100 Index Components:

[TABLE=119]

Note: A ticker is included for components listed in the US markets

Some Observations:

1.All the top 5 Canadian banks are in this list.

2.While many of the components in the index are banks, stocks from other sectors like utilities,energy, telecom are included as well.

3.Among the Asia-Pacific countries Australian and Singapore stocks seem to be pay high dividends than Japan and other countries.

4.Thirty out of the 40 components for Americas are stocks of US companies.

The above yield data is thought to be accurate.Please do your own research before making any investment decisions.

Disclosure: Long many stocks in the above list.

The World’s Top Ten Safest Banks 2008

Posted by on

The October issue of Global Finance magazine featured The World’s Top Ten Safest Banks for 2008.

The Banks were selected based on:

  • A comparison of the long-term credit ratings (issued by S&P, Moody’s and Fitch’s)
  • Total assets

of the 300 largest banks in the world.

The World’s Top Ten Safest Banks 2008:

[TABLE=117]

Of the above ten banks, Lloyds TSB (LYG) , BNP Paribas (BNPQY) and Wells Fargo (WFC) are listed in the USA.

In September Llyods Bank (LYG) of UK agreed to acquire U.K.’s biggest mortgage lender HBOS plc (HBOOY) for a fire-sale price of £12.2 billion ($21.8 billion) in an all stock deal.Llyods will offer 0.605 shares for every 1 HBOS share. Llyods raised a total of £5.5 billion from the British Government by selling ordinary shares for £4.5 billion and preference shares for £1 billion. The current yield on LYG is 12.76% but the dividend may be suspended till 2010 as part of the requirement of the government rescue package.

Last month Wells Fargo (WFC), the largest bank on the US West Coast, announced a deal to acquire Charlotte, North Carolina-based Wachovia (WA) for about $15.1 in stock. To fund this deal, Wells Fargo raised about $11B in a stock offering on November 7. It priced the sale at $27/share below the Nov 7 closing price of $29.50. The current yield of WFC is 3.99%.

The Paris, France-based BNP Paribas (BNPQY) trades on the OTC market and pays a dividend of 7.21%. Year-to-Date the stock is down about 35%. In 3Q 08, profit fell 56% for this French banking giant. BNP Paribas also announced that will take control of the troubled Dutch financial group Fortis’s Belgium and Luxembourg operations.

Also checkout:

The Best Banks of the World 2008

Royal Bank of Scotland Group plc(ADR): Reverse Split Complete

Posted by on

Royal Bank of ScotlandYesterday November 7,2008 Royal Bank of Scotland Group plc(RBS) completed a reverse split in the ratio of 20:1 of its ADR shares traded in New York.

This reverse split was first announced on Oct 30,2008 (Source: RBS Investor Relations Site):

Royal Bank of Scotland Group PLC- RBS Ratio Change for ADR Holders

“To maintain an appropriate price range for The Royal Bank of Scotland Group American depositary shares (“ADSs”) representing ordinary shares trading on the New York Stock Exchange, (NYSE Symbol: RBS), effective November 7, 2008, the ratio of one (1) ADS representing One (1) ordinary share will change to one (1) ADS representing 20 (twenty) ordinary shares.

Existing ADR holders will receive one (1) “New” ADS for every twenty (20) “Old” ADSs surrendered for cancellation.

This ratio change does not affect any of the RBS Preferred share ADS programmes.”

Before this reverse split the ratio between an ordinary share and an ADR share was 1:1.

ADR Share Price Calculation:
Yesterday closing price of 1 London-listed RBS ordinary share = 64.0 p
At an exchange rate of 1 British Pound = 1.56911 $, 1 RBS ordinary share = 1.00465$
So with the Reverse Split 1 ADR = 20 ordinary shares
That means 1 ADR must trade for: 20 * 1.00465 = $20.09

However RBS closed at $19.28 yesterday in New York.One reason may be that the market does not believe this reverse split will have a positive effect on the stock.

As part of the British Government’s 37 billion pounds rescue plan announced last month, RBS will boost its capital by 20 billion pounds by turning over control to the government. The government will get 5 billion pounds of preferred shares and common shares for the remaining 15 billion pounds. As a condition for accepting the government cash infusion, RBS has agreed not to pay a cash dividend as well until 2010. Despite the above cash infusion, many institutional and individual investors may not touch RBS due to many unknowns faced by the bank and the banking industry in general. Also on November 4, 2008 RBS warned “it will be hit by more writedowns and rising bad debts this quarter as its incoming chief executive kick-started a strategy overhaul aiming to restart dividends in 2010” and added that “it expects losses on bad loans to continue to rise as a worsening economy and tough financial markets feed through to consumers and businesses”

Only time will tell if the reverse split will be successful or not in the long run.

Disclosure: Long RBS

A Look at Four Frontier Market ETFs

Posted by on

Earlier this year I wrote an article on Frontier Markets titled Explore some Frontier Markets !!!!!. In the ETF world, a few ETFs were launched this year specifically for frontier markets.In this post lets look at four of them.

Photo: Beach at Agadir, Morocco

1. PowerShares MENA Frontier Countries (PMNA)

Launched on July 9th of this year, this ETF covered the Middle East or North African countries. Some of the countries this fund invests in are Egypt, Morocco, Oman, Lebanon, Jordan, Kuwait, Bahrain, Qatar and United Arab Emirates.

Since the launch the fund is down 39.67%. Thats just over 4 months. The fund has an expense ratio of 0.95% and assets of about $19M.

2. Market Vectors Africa ETF (AFK)

Launched in July, this fund tracks the Dow Jones Africa Titans 50 Index. AFK provides exposure to countries like Egypt, Morocco,South Africa,Nigeria,etc.

The expense ratio is 0.98% and the fund is down 43.96% year-to-date.

3.Market Vectors Gulf States ETF (MES)

MES tracks the Dow Jones GCC Titans 40 Index which includes stocks from the GCC countries of Bahrain, Kuwait, Oman, Qatar, the United Arab Emirates and Saudi Arabia.

The expense ratio is 0.98% and the fund is down 42.71% year-to-date.

4. Claymore/BNY Mellon Frontier Markets (FRN)

FRN tries to mimic the performance of The Bank of New York Mellon New Frontier DR Index. The expense ratio is 0.65% and the fund’s inception date is June 12,2008.

As we can see in the above performance numbers these ETFs are not for the faint-hearted. The frontier market countries are much worse than the emerging markets of say Brazil or India. These ETFs are extremely risky and may fall even more by the end of this year.

Brazilian Banks Banco Itau and Unibanco To Merge

Posted by on

ItauOn November 3,2008 Banco Itau Holding Financeira S.A. (ITU) and Uniao de Bancos Brasileiros S.A. (UBB) announced to merge their operations to form a new company called Itau Unibanco Holding S.A. The merger will be effected by the merger of shares(Common, Preferreds, GDRs) of both the companies.

UnibancoExchange Rate: Each 0.17391 UBB (GDR) will be exchanged for 1 share of the new Itau Unibanco Holding S.A.

As of September 30,2008 Itau had a market capitalization of 69.1 R$ Billion and Unibanco had a market of 18.8 R$ Billion. After the merger, the new bank will be among the Top 20 banks in the world in terms of market capitalization. Itau Unibanco Holding S.A. will have assets of 575.1 R$ B (or) about $265 billion, in assets.

Before this deal was announced, another Brazilian bank Banco Bradesco (BBD) was the largest private bank in Brazil. After the deal BBD will fall to number two since Itau Unibanco Holding S.A. will become the largest bank. The largest financial institution in Brazil is the government-owned Banco do Brasil.

Year-to-Date UBB and ITU are down -51.6% and -39.6% respectively as of Nov 7, 2008.