₦airaland Forum

[quote author=paddy_lo link=topic=495589.msg6561136#msg6561136 date=1281618798]Heres the big picture

In 2007 the market was for whatever reason,discounting the shares of ICBN while at the same time massively overvaluing the stock of some of the banks u listed above

Now i can also say that ICBN valuation was more down to earth and realistic than the rest of those banks[/quote]All banking shares were overvalued, however I beg to differ that ICBN was more reasonably priced. It cannot be the only reasonably priced bank in the whole banking sector. That defies logic.

I would rather say that ICBN's assets were overstated, hence its P/B was low.

First Bank and ICBN marketcap was almost the same (dont have the figures to hand).

Hence ICBN was claiming to have 5 times more assets than First Bank. . . . doesnt make sense. . .

[quote author=paddy_lo link=topic=495589.msg6560604#msg6560604 date=1281612927]@Ibime

If Nigerian banks were trading at those ratios u posted(in 2007),then they were all grossy overvalued. . .Banks dont usually trade more than 2times book anywhere in the world[/quote]Or you would say that ICBN had inflated its assets at a faster rate than the market could adjust for.

Or you would say that Nigerian market was naturally speculative, yet they distrust ICBN reporting.

Or you would say the market was inherently inefficient at keeping up with ICBN's wonder results! 




Whatever the case, ICBN would be a red flag for simply being completely out of sync with the market.

Ill post the ratios for the other banks later as proof. . .

At least we agree on one thing. . . . Nigerian banking sector was ridiculously overpriced. . .

[quote author=paddy_lo link=topic=495589.msg6558634#msg6558634 date=1281579731]Intercontinental was trading at around 1times book. .  .ie 0.92(Price) X 29(Book value) = 27(Share price)

Maybe First bank was trading at 1.5 X book. . who knows,cause i dont have the figures

It just means that First bank was trading at a premium to intercontinental

or that inter was trading at a discount to First bank or its peers(i dont know what the ratios for other banks was at the time)

Why the discount?. . .well maybe the market percieved first bank as being a stronger bank,with better networks
Maybe it saw risks in inters porfolio

Maybe it was mispricing Intercontinental,and overpricing first bank

either way its not a crime[/quote]If a bank trades at less than book value, it likely means that the market doesnt trust its balance sheet.

The break-up value of the bank is worth more than the bank itself.

A bank with low P/B should also have low ROE, yet I remember that ICBN was posting double the ROE of First Bank.



[quote author=paddy_lo link=topic=495589.msg6558634#msg6558634 date=1281579731]one more thing,if first bank was really trading at a P/B which was more than 5 times higher than ICBN. . (like ibime said),then Firstbank must have been grossly overvalued

No commercial bank should trade at more than 2 times book. . .

I am sure that even now(with less competition) First bank is not trading at more than 1.5 times book[/quote]Most Nigerian banks were trading at about 5 P/B in 2007. . . . . P/B of First Bank and all other banks only came down as stock prices crashed. . . .


First Bank was 5.64
Access Bank was 4.73
First City Monument was 5.33
Union Bank was 4.5


Zenith, Oceanic, UBA and GTB were all over 8

PHB was 10.87!  


To put this in context, ICBN was claiming to offer 5 times more value (and often 10 times) more value than any other Nigerian bank. Should set alarm bells ringing right?

Even after 98% YTD growth in 2007, ICBN was still not up to its book value. This is for a company posting 3 times the revenue per share of other banks in similar price range. I dont need a magician to tell me that (a.) its assets are grossly overstated and/or (b.) institutional investors dont believe its reporting.

If I recall, when I checked Intercontinental's Price/Book ratio in 2007, it was 0.92. . . . thats when I knew that the assets are overstated on their balance sheet. . . . I dont know how First Bank had P/B which was more than 5 times higher than ICBN, yet ICBN was giving almost double ROE than First Bank. . . . Jarus even reminded me recently that I've been warning of dodgy Intercontinental reporting long before Sanusi. . .

Here was my intial research into Intercontinental in 2007. . . abeg anybody wey sabi should check these ratios and tell me whether it looks right against ICBN's price behaviour/ reporting at the time. . . Akingbola is busy painting a rosy picture of ICBN's health, but the telltale signs of fraudulent reporting were evident 3 years ago. . .

hahahaha. . . . . these guys are still here with their dinosaur arguments? 



Lai Alabi took over Wema Bank when Soludo was unhappy with Omoyeni. . . . no conspiracy!

Lai Alabi took over Intercontinental Bank when Sanusi was unhappy with Akingbola. . . . conspiracy!


Sanusi subsequently tries to sell Intercontintental to RMB . . . I guess Saraki owns RMB?




Akingbola better return our tithe money instead of telling us biblical fairytales. Which kain man go dey submit conjectures in court of law? Ole Barawo!

I always liked Oliseh's tactical discipline in his Super Eagles days. The only flaw he is very argumentative and undiplomatic. His fight with Danny Blind @ Ajax is just an example of that. I say he should go and find success with the youth teams first, cos now is SiaSia's turn.

12large:
ibime am sorry you need to check your head. you do not even know if amodu father and mother is alive how can you just insult the two of them like that just because you disagree with his opinion.

hehehe. . . . were you not the one that said this a couple of days ago. . .

12large:
emmanuel thunder strike your family. mikel your father best player. a player that passes the ball sideways and backpass almost all the time, a player with no dribbling skill a player that have not score any goal in 200games na naija best player i for use cultlass cut that hand wey u use type this non-sense

https://www.nairaland.com/nigeria/topic-493492.0.html


Laugh want kill me die. . .

Rumour's been going round for sometime that both Babalola and Aganga would be removed. . . .

^^^Erm. . . . it is my prerogative to cuss Amodu if I want. I have been cussing Amodu on here for ages, why only now you come dey act? Because someone who takes his name from the size of his manliness (12large) believes I am being vulgar? The irony. . . .

Can you show me on your moderator handbook where it says that we cant cuss celebs?

Who made y'all the moral arbiter of what I can or cannot say about unknown people who are not members of Nairaland?

You have made a wrong judgement here. Its not your remit to decide whether me cussing a public figure is an offence.


Again, I ask:

If I curse IBB and all his generations, would you also delete my posts?

Carvalho joins Real Madrid for £6.5m. . . .

Are we gonna get a replacement. . . Alex is always injured, and Ivanovic is still covering Bosingwa at right-back. . .

^^^So why you come delete my post nah?. . . . is it against the rules to diss the family of incompetent and corrupt public officials? 

If I say thunder fire IBB and all his family, down to the 4th generation, would you also delete my post?

Make una take time o! 

El Dot ate all of em. . . . he reminds me of Big L. .

Yes, am a casual observer. . . . havent been watching the last 2 months though. . . always cut off my sports channel subscriptions in the off-season. . . . the last UFC I watched was probably UFC115 with the Rampage vs Evans fight.

Whats been happening since then. . . .

This story seems to be true.

The brute is even head of PDP in Warri. Just goes to show that PDP is a party of thugs.

The track is poorly mixed. . . . can barely hear what the rappers are saying. . . the horns are too loud. .

THE AMAKA:
no one can control anyone's vote, so why the noise?

Actually, after Donald Duke's expose on vote-rigging, I believe AGPA and by extension Ojukwu have the power to deliver all Igbo states. The state ALWAYS votes for the Governor's preferred candidate.


BTW, who be dat for your profile pic. . . . hmmmmmmmmmmmmm. . . .

mikeansy:
If you spend more time learning the past tense of think you will know that somethings are beyond money.

IBB is very popular in the SouthEast and a lot of that has to do with his free market policies which a lot of Igbos find very helpful in their private lives.

You may have reservations about this but that is simply the fact.

What? Igbos were unable to do business before IBB?

Kalou playing right-wing for CIV. . . . Balotelli making debut for Italy. . .

[quote author=~Borat~ link=topic=481784.msg6549660#msg6549660 date=1281465973]Does anyone want to see my team. . ?
100points every week team, you need to see to believe[/quote]Lets see it then. . . I doubt it will get you into the top 20. . .

@ all Chelseans,

Please ignore mama-gee at all times. Dont quote her posts or engage in any banter with her. I dont want this thread to be hijacked with all sorts of nonsense.

Klose made his name against the likes of Costa Rica, Saudi Arabia and Ecuador. . . . these three teams alone account for half of his World Cup goals. What makes him better than Oleg Salenko? He's just a lucky bazztard!!!

seanet02:
WHY NEWSPAPERS FAIL IN NORTHERN NIGERIA



There are several reasons for the failure of newspapers in northern Nigeria and in fact it was the subject of discussion in the defunct Sentinel and the issue has remained very debatable since. The media is the arena of participation in the society and any segment of the society, which is left behind in that competition will eventually be marginalized. In the Nigerian context we have seen how the vocal southwestern media was used in ensuring political power shift from the North to the Yoruba enclave of southwest.

Newspapers always fail in the North cos Northerners dont read like Southerners. . . . not all this nonsense that this guy is typing here. . .

HNIC:
We will continue to suffer because of this highline that we play.
If you play like that, you've got to have enough mobile midfielders to cover up.
Watch when we are being 'countered', it's only the defenders sprinting back to cover.
All others are simply jogging back.
In short, IMO, until we get players that will be disciplined enough to play this style, we are wasting time.

Denilson and Diaby dont do enough pressing, especially Denilson. This is compounded by the fact that Alex Song runs beyond the ball too much for a DM.

Buy Anthony Annan for £3m, and play Song infront of him. Annan will never stray from his position. He is what you call a no-holds barred DM. If need be, he will use dirty tricks to ensure his defence dont concede - witness how he poked his fingers in Mikel's eye during ANC 2008 and totally destabilised Nigerias midfield by that single incident.


Meanwhile, where do you guys think Nasri will play this season. . . . I need info for my fantasy team.

Ive always known that Eguavoen is a fool since his reckless penalty against Italy in USA 94.

Nigerians dont want Yakubu, not because he missed a chance against South Korea, but because he is OLD and 3 or 4 years past his retirement date!!!

Lets wait till the competitive season begins. . .

John Terry's lack of pace is costing us two or three dangerous situations every match.

I cannot believe some fool at Chelsea gave him new contract instead of selling him to Citeh for £40m last season.

John Terry should be sent to old people's home.

Dru Hill - What are we gonna do


The lyrics, harmonies and arrangements on this are superb. . .


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