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DTB 2022-2026
VituVingiSana
#1 Posted : Tuesday, March 29, 2022 11:20:51 AM
Rank: Chief


Joined: 1/3/2007
Posts: 17,811
Location: Nairobi
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Ericsson
#2 Posted : Tuesday, March 29, 2022 12:33:15 PM
Rank: Elder


Joined: 12/4/2009
Posts: 10,412
Location: NAIROBI
VituVingiSana wrote:
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.


You said DTB is a better bet and counter to hold compared to KCB.
We can compare Total Returns for each in April 2027 as you had suggested.
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
Ericsson
#3 Posted : Tuesday, March 29, 2022 12:57:26 PM
Rank: Elder


Joined: 12/4/2009
Posts: 10,412
Location: NAIROBI
VituVingiSana wrote:
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.


Diamond Trust Bank will open 20 this year and another 20 by 2024. Average branch size used to be 2,200 sq. ft , but now only need 600 - 800, with less staff who will shift functions from transaction to advisory
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
My 2 cents
#4 Posted : Tuesday, March 29, 2022 2:15:59 PM
Rank: Member


Joined: 6/2/2010
Posts: 893
VituVingiSana wrote:
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.


Ask yourself whether management's interests are aligned with yours or not. Probably not. DTB does NOT exist to maximise shareholder value through the normal route of share price appreciation and dividends.

Instead it is a deposit pooling mechanism for some key constituents. They are encouraged to bank with DTB to get very high interest rates on their deposits and also to access some jumbo-sized business loans. Very frequently the latter go belly up.

Check how much is paid as interest expenses. Very high. Those are the main stakeholders.
Check the level of bad loan provisioning. Very high. Possibly to also minimise taxes as far as possible.
Check how much is paid to staff. Very low compared to banks of similar size.
Check how much is paid to 'shareholders' in the form of dividends. Very low to keep high cash levels for the true stakeholders.

Now, that said. I am buying some DTB shares because they are super cheap and I am holding out that some day in future the interests of the true shareholders will prevail.
Receptor
#5 Posted : Tuesday, March 29, 2022 3:38:08 PM
Rank: Member


Joined: 7/1/2019
Posts: 108
My 2 cents wrote:


Ask yourself whether management's interests are aligned with yours or not. Probably not. DTB does NOT exist to maximise shareholder value through the normal route of share price appreciation and dividends.

Instead it is a deposit pooling mechanism for some key constituents. They are encouraged to bank with DTB to get very high interest rates on their deposits and also to access some jumbo-sized business loans. Very frequently the latter go belly up.

Check how much is paid as interest expenses. Very high. Those are the main stakeholders.
Check the level of bad loan provisioning. Very high. Possibly to also minimise taxes as far as possible.
Check how much is paid to staff. Very low compared to banks of similar size.
Check how much is paid to 'shareholders' in the form of dividends. Very low to keep high cash levels for the true stakeholders.

Now, that said. I am buying some DTB shares because they are super cheap and I am holding out that some day in future the interests of the true shareholders will prevail.


It is a no-brainer really. Price will certainly correct sooner or later. Shikilia hapo hapo.
VituVingiSana
#6 Posted : Tuesday, March 29, 2022 5:38:54 PM
Rank: Chief


Joined: 1/3/2007
Posts: 17,811
Location: Nairobi
Ericsson wrote:
VituVingiSana wrote:
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.


You said DTB is a better bet and counter to hold compared to KCB.
We can compare Total Returns for each in April 2027 as you had suggested.
I had 3 banks in my list for a reason. 1/3 each for Equity, DTB and SCBK.

I am happy to compare my portfolio to yours in 2027.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
VituVingiSana
#7 Posted : Tuesday, March 29, 2022 5:42:38 PM
Rank: Chief


Joined: 1/3/2007
Posts: 17,811
Location: Nairobi
My 2 cents wrote:
VituVingiSana wrote:
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.


Ask yourself whether management's interests are aligned with yours or not. Probably not. DTB does NOT exist to maximise shareholder value through the normal route of share price appreciation and dividends.

Instead it is a deposit pooling mechanism for some key constituents. They are encouraged to bank with DTB to get very high interest rates on their deposits and also to access some jumbo-sized business loans. Very frequently the latter go belly up.

Check how much is paid as interest expenses. Very high. Those are the main stakeholders.
Check the level of bad loan provisioning. Very high. Possibly to also minimise taxes as far as possible.
Check how much is paid to staff. Very low compared to banks of similar size.
Check how much is paid to 'shareholders' in the form of dividends. Very low to keep high cash levels for the true stakeholders.

Now, that said. I am buying some DTB shares because they are super cheap and I am holding out that some day in future the interests of the true shareholders will prevail.
As my guy WB says! Laughing out loudly Laughing out loudly Laughing out loudly

I am going to do an analysis of DTB vs others. Equity excites me the most for growth. 20+% ROE and DRC hasn't fully kicked in.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Ericsson
#8 Posted : Tuesday, March 29, 2022 5:47:17 PM
Rank: Elder


Joined: 12/4/2009
Posts: 10,412
Location: NAIROBI
VituVingiSana wrote:
Ericsson wrote:
VituVingiSana wrote:
FY2021 results were awful.

EPS 13.98
DPS 3.00
DPR 22%
ROE 6.3% (below inflation!)
PB: 20%

The story they are selling:

- Large losses in 4Q2021
- 4.5bn to be spent on expansion
- "Digital Bank"
- Pricing model

The reality is that DTB has done wrong by its shareholders.
The dilemma is the price is so low and one needs to absorb the loss and consider it as a potential "new" investment.

Awful. Awful. Awful.

I wonder if it makes sense to hold on or buy ar today's prices.
That's the analysis I need to work on.


You said DTB is a better bet and counter to hold compared to KCB.
We can compare Total Returns for each in April 2027 as you had suggested.
I had 3 banks in my list for a reason. 1/3 each for Equity, DTB and SCBK.

I am happy to compare my portfolio to yours in 2027.

I have ABSA,Co-operative bank and KCB.
Twende kazi.
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
My 2 cents
#9 Posted : Thursday, July 14, 2022 8:11:20 PM
Rank: Member


Joined: 6/2/2010
Posts: 893
I hope this bank knows what it is doing. While everyone else is growing digitally, they are still expanding bricks & mortar.

https://www.businessdail...expansion-drive-3877114

https://www.businessdail...-kenyan-branches-3877654
heri
#10 Posted : Friday, July 15, 2022 9:57:01 AM
Rank: Member


Joined: 9/14/2011
Posts: 802
Location: nairobi
@VituVingiSana, does the persistent insecurity in parts of DRC constitute a big threat for banks doing business in DRC?
VituVingiSana
#11 Posted : Monday, July 18, 2022 1:07:41 AM
Rank: Chief


Joined: 1/3/2007
Posts: 17,811
Location: Nairobi
heri wrote:
@VituVingiSana, does the persistent insecurity in parts of DRC constitute a big threat for banks doing business in DRC?

That's a tough question.

I would say YES but DRC is huge and unless the bank has substantial business in those affected areas it may not be a major issue.

From what I understand banks aren't huge into lending as they are in Kenya. There's a lot of transactional business.

Overall, I am bullish about banks in DRC over the medium-long term.
There will be disruptions over the next few years.

BUT wars (civil or external) can upset the apple cart.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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