Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (48774)	7/14/2012 5:39:15 PM
From: Spekulatius	Respond to of 78626

I looked at some of the banks and they seem to be associated with Credit Agricole. I assume that, regardless of what metrics their balance sheet shows, they will go down if Credit Agricole goes down. I may be wrong, but I think that is the main risk that your would be taking, since Credit Agricole does not exactly look solid. Bollores has a bunch of subs that look very obscure like the Compagnie du Cambodge (started out in plantations), so it's very hard to value.

To: Paul Senior who wrote (48774)	7/15/2012 4:53:28 AM
From: Jurgis Bekepuris	2 Recommendations Read Replies (1) \| Respond to of 78626

Pretty good - though general - Howard Marks interview and comments about it by Brooklyn investor. I think I agree with most of their observations and comments.

To: Paul Senior who wrote (48774)	8/27/2012 10:23:00 PM
From: Spekulatius	Respond to of 78626

Re French Banks. I found out how these french credit agricole subsidaries work (sort of). It does seem that there are 39 regional banks, a dozen of which are public companies, others are private or just mutual companies. It appears that in case of those that are still public, the Credit agricole mothership typically owns 25% of the shares but each bank is individually run , it appears more like a loose branding federation than one company. Reading from the balance sheets (i looked at maybe 1/2 a dozen of those) it looks like they have quite solid capital ratios with a Tier I ratio of betwen 15-18% and tangible book value >10% of the balance sheet. They seem to be doing business only locally, taking deposits and giving loans for real estate, small business and individuals, nothing fancy. Profits are moderate but some do a little more than 1% ROA, not too bad. The main attraction that the banks are dirt cheap at 3-5x earnings and pay dividends around 8% that in some cases are slowly rising. Some of those have gone private apparently, which resulted in a nice windfall for shareholders. This all looks quite attractive to me. I looked throught the FT.com tearsheets and i am going to pick one or two that look best to me. I think the dividends alone make this worthwhile. Better knowledge of the french language would help... Here is a map of these banks: creditagricole.info