Some thoughts on Sept figures + estimated returns
Hi Folks,
Cover Note to go with thoughts on September 2011 Figures
Great start to the year, then a bit of a downturn followed by two good months in July & August followed by a lower, but still plus figure in September. So we still have great returns this year gaining an average of £13.620m per month – Still good by any standards. Our next dividend, I think out by late October/mid Nov should be around 7.3p/£.
- Again re our dependence so far on ‘pulling in cash’ from later years to subsidise shortfalls as occurred in 2009 and 2010.
· In 2009 approx £48m was brought in early from later years I.e. 2010/2016, giving a return of £13.33%
· In 2010 approx £53.029m was brought in early from later years I.e. 2011/2016, giving a return of between 17.032% and 19.003%.
· So for 2011 the picture regarding bringing in cash from later years looks like this – Cash due back 2012/2016 is £113.704m and at 13.33% = £15.157m, the JLs have already brought back £38.472m (33.83%) by September, thus well surpassing the percentage of that achieved in 2009 and 2010.
· The JLs have brought back in overall £122.579m in 9 months Inc £38.472m from later years. Note, the £122.579m includes the cash in early from later years and all interest received in this year. I still think it unlikely we will get £114.573m back from the £135.062m due back from loans in 2011 alone, unless large loans come in. So we could see a total of between £35-£40m being pushed back from 2011 into 2012. Having said that I still feel the JLs have had a very good year bringing cash back in and way above 2009 & 2010 both in Percentage and value terms.
- In respect of the 10 large original loans and the latest set of large loans we can see the following, based on the JLs info in the July Figures & July Progress Report;
· Retained the following until we get some sort of update on the 10 large loans – hopefully shortly. We now know the 2nd set of 10 large loans were split; 3(2011), 4 (2012), 2 (2013) and 1 (2014). I think the latest set is split either 2(2011), 4 (2012), 3 (2013) and 1 (2014) or 3(2011), 4 (2012), 2 (2013) and 1 (2014). Have sent questions off to the JLs requesting an update on the split by year.
· The July Progress Report updated by the July figures showed the following: 1 loan >£10m, 7 loans between £5-£10m, 28 loans between £1-5m and 26 <£1m = 62 loans worth £140.843m. I think the 2 loans repaid in August both fell into the £1-5m category. 2 loans repaid in September, again I think in the £1-£5m range. Some discussion on the DAG over the value of the 1 remaining loan at >£10m. Again question asked of the JLs in relation to this loan, hope for an answer of some sort soon. The value of the 10 large loans still appears to be in the region of £96m (approx 76.2%), I think there will have been some movement, but await answers to questions in order to update the known data.
· As discussed with Icecrusher in DAG postings the 10 large loans have now become very significant, as we can no longer depend on high early returns from later years, only a total of circa £28m due back between 2013/2014, based on the Sept figures update. And we know the £8m due back in 2014 is 1 loan (a large loan at that). So even at an early return of around 30% would only yield £8.4m - not a lot.
· The other part of the 10 large loans is they still total around £96m until we get a further update from the JLs. I have been informed there is some movement there and I hope to get some info by end of October-ish. And I will update all of you if I get data. But right now circa £96m out of £125.9m = 76.2% of the £125.9m. So if we see circa £40m being pushed back into 2012 that would see around £87m to come back next year less any further early returns this year. Say it ends up at £80m we would then need 84.83% of £80m less let's say early returns next year of the circa £8.4m = £71.6m at 84.83% = almost £61m out of the £80m = 76.25%. And note we only have £30m due back from the smaller loans, so the one very large loan left and the other 7 loans of between £5-10m will have a very significant part to play on us getting our 10% next year or 15% over the next 18months.
My thoughts on the September figures and updates on estimates are all contained in the attachment with this cover note – again to try and retain the format of the layout. My Table 11 has been updated to allow for the August figures. I still get 96.300p/£ return overall.
The figure still due for unresolved had dropped to £12.5m at end of August less another £0.1m in Sept = £12.4m plus unclaimed at £1.6m = £14.0m. Await answers to questions based on 30.9.2011 update on unresolved/unclaimed to clarify this further.
I have also revamped my Table 11 to take full account of all cash received so far up to 30.9.2011 and down dated what is still due in 2011 (based on 84.83%) on receipts so far. Also revamped down what is still due in value from following years based on excellent early recoveries so far this year. Also revamped interest downward that is still due in 2011, based on July Progress Report. Worth noting that we appear to have had good recovery in interest this year as it is more than £9m and thus worth 1p/£ to us. Have also increased recoveries from E&Y (KSFUK) to their new increased estimated lower 78%. (Increase of £7.383m to us).
We are now due our 2nd return of the year (I think we will get it by late October/mid November) and it should be around 7.3p/£. That would put us over the 80% in returns, possibly 80.9p/£ overall so far.
If we get as high as 7.3p/£ it might be still be possible to get another 5p/£ next June, but perhaps harder for a second 5% in Dec 2012. If not we should then get a slightly higher figure by June 2013. Once we know the size of our next dividend we will be able to forecast the following 18 months better. I’m currently staying with the 84.83% all the way through and also the 78% (from E&Y - KSFUK) all the way through until any changes are notified by the JLs or E&Y.
- Continuing to say I will ignore any return from ‘Parental Guarantee’ until JLs give definite figures on what to expect on any return from Iceland or give a definitive value on agreed claim plus data on the value of interest due. I might then update my Tables to include some form of return and timespan involved. Until then we should ignore it totally. Still think we have a better chance of a return, at present, through E&Y (KSFUK) claim against Kaupthing hf. Their claim has been accepted although the value has still to be agreed. But it could see returns for their unsecured creditors (includes us) move up nearer what our JLs hope to recover from the KSFIOM loan book. Perhaps their ‘6 monthly report’, now due (probably out late Oct/early Nov, will give more info on this.
It would therefore appear to leave any other litigation as the outstanding way of getting cash back. We did not get much from the JLs 9.7.2011 Progress Report, so we will have to keep waiting for any movement in that area.
So, we should stay buoyant after the September figures, dividend due as said, between late October to mid November. Lets see how things continue over Oct/Dec this year and then through to next June, 2012. On target, relatively speaking, for a good year partially thanks to the repayments of some of the larger loans from 2011 & later years, our JLs have well met their lower 84.83% estimate for this year (if you include interest & cash returned early from later years), and hopefully E&Y (KSFUK) keep meeting their lower estimated returns at least. – but who knows.
As always,
Take Care, and God Bless,
Gordon 45
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Aircraft Sale ?
Re. the JL's announcement of the pending dividend being at least 9.5%.
Could it be that the aircraft has finally been sold ?
@DRAM - Aircraft
Could be, but no basis to conclude that from the the 9.5% + dividend announcement. The two aircraft loans outstanding in July had a combined value of 7.45M or less than 1% of original amount owed.
Notice of Sixth Dividend : not less than 9.5p in the £.
13 OCTOBER 2011
Next dividend
Attached below is a copy of the notice for the next dividend which has been published in the press and sent to all known creditors who have not yet submitted a claim.
Notice of Sixth Dividend
In accordance with the advertisement, creditors who have not yet submitted a Proof of Debt form are required to return the completed form to the Joint Liquidators prior to 21 October 2011 in order to be included in the sixth dividend.
For claimants with an admitted claim directly in the liquidation, if you wish to change the bank account details for payment of your dividends please contact the bank prior to 28 October 2011. Any request for a change in payment details after this date may result in a delay to the payment of the sixth dividend to you. The Joint Liquidators will only change a claimant's payment details upon receipt of an original, signed document - photocopied, faxed or scanned documents will not be accepted.
As previously advised, dividend levels can only be determined once cash has been received. We will distribute as much cash as is available at the point of declaration, which based on cash currently in hand will be not less than 9.5p in the £.
Gordon 45's Continuing Analysis
Just to say a very big "Thank You" to Gordon 45 for his continuing detailed analysis , which only a select few are able to do.
It is indeed gratifying to see how much "Liquidation" option voted on at the Creditors Meeting so long ago, appears to be realizing (American !) and we should count our blessings we took that route.
We still have the current European debt crisis to weather, and so far the spread of overseas deposit locations being used by JLs is help to hedge those positions.
Best Wishes All
Next dividend announced
Announced today on KSFIOM website: 6th dividend of at least 9.5/£ to be paid within two months of 27 September.
Considerably more than the around 8p/£ predicted by G45 & Ice, suggesting a large loan may have been repaid this month?
Good news in any case!
http://www.kaupthingsingers.co.im/Pages/2011/October/13October2011.asp
Hi Anrigaut - Re 9.5P/£ dividend
Hi Anrigaut,
Thank you - Brilliant news for all of us from the JLs and paid by 27.11.2011. I agree entirely with your thoughts. A large loan or 2 fairly large loans have been repaid or promised to be repaid this month. By giving creditors until Oct 28th to register any bank account changes etc, the JLs are obviously receiving or expect to receive cash back by late October - all adding to the 'pot of gold' to give out.
I think Icecrusher and myself were quoting between 7.3 -8p/£ based on what was already in. Although I have never stated it - to frightened to raise people's hopes - I thought we could get around 10p/£ by end of Dec 2011 if the £30m still required from 2011 loans came in to reach the 84.83% for 2011(did not think it could happen). Based on the JLs statement today and your own thoughts something big has come in or about to come in. - and that's great. I'm sure Icecrusher will have had around the 10p/£ for late December also in his mind.
But it means at least an overall return of 83.1% back by 27.11.2011, and it might be earlier. We really need to see the October figures to see the actual receipts for October and that should give us some clues as to what loans actually came back in and their worth. I am still hoping for some answers to questions raised with the JLs and these included some questions on an update on the current 10 largest loans.
It is hard to speculate on where we go from here on further dividends until we get these figures. But it would appear that the % of remaining capital due back from the KSFIOM loan book from the now 10 current highest loans will now show a decrease from the 76.2% I thought, as at the end of Sept 2011 figures - and that can only be good for loan returns next year, as it gives a bigger spread.
It is the staying calm and patient that is hard on these occasions as it is frustrating that you cannot get into the figures and work out what you think is going to happen next. But one thing is certain we are way ahead of what we all thought might be returned to us at this time.
One other small point is - are we now more than half way through this liquidation? With the 2016 loan off the picture now and the last loan due back by Spring 2014 and my predicted end (hoped for) by Dec 2014. So are we now starting on the downward slope with only! a max of 16.9% to get back + interest?
I appear to have upset Ian re those who invested in USD, and there have been posts from some who invested in Australian Dollars, from New Zealand and obviously other countries etc who have all lost out due to the rate of the GBP against these different currencies at the time of the collapse. I can only say when I report what I think might happen and when in GBP, it is because that is the what the JLs use. I feel for all of my DAG colleagues and would never intentionally ignore their situation or hurt, no matter what currency they invested through before the collapse in October 2008. Please accept my apologies if I offended any of you.
As 'Conned' said,we are all in this together, let's stay that way and fight on for 100% + recovery or the highest % that any of those who invested through foreign currencies can hope for.
Gordon 45
Hi Gordon 45, I would just
Hi Gordon 45,
I would just add that I would very much doubt the JLs would risk announcing "at least 9.5p/£" unless - as they say - they had that already in hand; ie one large loan or several smaller ones already repaid since the last update, rather than merely promised. Whether there is a chance of even more by end October I have no idea. But in any case 9.5p can only be good news.
At least 9.5% etc....
The dividend announcement was dated some two weeks ago and it would appear that at that time, the JLs anicipated the return of a fairly decent-sized loan (perhaps even the 'biggy' that I alluded to a couple of days ago) and have hung on to the announcement to make sure their expectations were met. I fully agree with you anrigaut; the JLs would not announce 9.5% without knowing it was solid.
As Gordon 45 says, this will take us (£ savers) above 83% - probably a bit more - very welcome indeed. Not to put a dampener on this uplifting news, but I do think this will probably be the last of the big payouts and likely the last dividend for a few months to come. I was sort of hoping that the JLs would pay out the 7.3% - 7.4% in the coffers right now rather than wait up to another two months (but to tell the truth I'd overlooked the advance notice of dividend and the time-lag involved) I imagine that leaving the payout until later saves on distribution costs. So, if the JLs already know that one good-sized loan (or several smaller loans are safely 'home' -- thereby assuring the 9.5% -- and perhaps two more months will pass before the dividend is paid, then it is possible that we'll get a bit more by 28th November.
83% is getting on up there, but there is still a large sum outstanding: £126,000,000 is not small beer... It was an abstract notion "getting our money back" and we thought 'someone' had to cough-up, but the Loan Book has really held up well - KSF had the loans covered with sound assets it seems -- the money just has to come back in its own sweet time. Thus far, the mortgagors have done a bloody good job of paying off their interest and their loans; whilst that which has been lost to set-off and write-off has been just about covered by exchange rate differential -- whichever way you care to look at that dichotomy...
An extremely good result, and we should give ourselves a break and be pleased about it! There will be a roll-over into 2012, but perhaps the 'biggy' has indeed been repaid -- which would be absolutely marvellous and remove such heavy doubts about future repayments. Better to have many morgagors with several small debts than one with a big debt, so that's my hope and desire.
I'm really itching to see the October report now to deduce what happened - and I bet G45 has a similar craving!
Ice
Distribution costs
Yes Ice, that is indeed the point. Distribution costs are substantial, so each time there is a balance to be struck between getting money out to us and agglomerating enough to keep it as cost-efficient as possible. If the JLs knew, as they must have done, that a sizeable amount was due to be repaid shortly after the KSFUK dividend came in, then I think we would all agree that it made sense to wait a little longer for that to come in. Sounds to me as though a good balance has been struck this time.
Good to see you just a little bit more cheerful. Let's hope future events give you - and all of us - good reason to stay that way!
To Icecrusher
Re your last para - you bet.
Gordon 45
Next dividend announced
Thanks for this happy news Anrigaut. It's made my day.
Also thanks to Gordon and ICE for all their hard work keeping us all informed.
KIWI DOLLAR
Thanks again Gordon for your input it really helps to make sense of it all.
Like many others, my CHAPS payment also failed on the 6th October 2008 with which I was intending to buy Kiwi dollars at the rate of $3 to the GBP. The exchange rate now is less than $2 to the GBP.
So to buy the same amonut of Kiwi dollars is now costing 50% more!!!
Gordon's post
Thank you Gordon. And even more so because I was expecting whatever you forecast in late December/new year rather than the possible October/November date you suggest. Sunny1.
I would beg to suggest that
I would beg to suggest that Gordon45 consider publishing a parallel '% return' figure for US$ account holders. No need for details.
Forex (again)
We have heard much griping over the years (all three now) about exchamge rates, and how it affects our precious savings.
Ice, expat and others have explained many times that getting your knickers in a twist about exchange rates is a lost cause.
They are something that we have no control over - unless, perhaps, you are wearing a striped blazer in one of those bull pits.
Through the eighties I was paid in US dollars and it went into a sterling account in the UK. I spent agonizing sleepless nights through all the fluctuations of those times.
I eventually realised what a waste of time it was to get worked up about it.
Over the long term, It's swings and roundabouts, you take the rough with the smooth, you win some, you lose some - need I think of another metaphor?
In 2004, I bought a house in Thailand, The exchange rate was 75 baht to the pound. Today, the rate is 48 baht to the pound. Am I having sleepless nights about it?
Not at all. I consider myself lucky that I bought the house at such a good rate, and incidentally, that in sterling terms the value of the house has gone up by 50%.
I am in the process of closing all my UK accounts and transferring everything to Thailand. I've had enough of UK banks - they are starting to charge a fee to people like us for the 'privelege' of having an account with them. It's the final straw - and now I can't wait to get all my money out.
The sooner the better whatever the exchange rate.
So, live with it - don't let the arseholes get you down - there's no point.
Exchange Rates
Spare a thought for people in Australia.
My CHAPS payment which failed on 6 October 2008 was to Moneycorp to pay for Aussie dollars I had contracted to buy at $2.30/Pound before we in Australia had even heard of a potential problem.
I was released from that contract by the nice folk at Moneycorp (but it cost me 800 Sterling) and since then the returns I have had from the liquidation have been exchanged at an average of $Aus1.60/Pound a loss of about 30%.
Me too
Well said...Me too but nevertheless, Gordon 45 and Icecrusher have helped me through this mess with constant updates. For that we all have to be very grateful. The loss hurts, but for sure its better than 100% loss or just getting 25% return.
Beg to differ...
If you were to take the exchange rate of $1.73/£1 on 8 Oct 2008 and $1.56/£1 today, then your percentage return comes to 72%. So, on a dollar account of £750,000 you would be $60,000 short. However, 1.56 to the pound is the lowest the rate has been in a while - it has been above 1.6 quite recently. Exchange rates are a variable feast and very unpredictable.
However, all of this is not the fault of Gordon 45 who is doing his best with figures extracted from the JLs using the rules set down by convention and isn't obliged to undertake this task for any of us - let alone perform something extra for the minority. I think your earlier comment insinuating a subsidy to fellow creditors is a bit unfair. You may well be correct in saying that it is costing you extra pounds to buy the equivalent number of dollars, but the cumulative gain of £15.9m due to exchange rate differential on mortgagors' loans does offset some of your loss even though it is a straight gain for those with no intention of buying back dollars. Would you say anything different if the pound gained ground against the dollar and was now worth $1.9/£1? Should that happen over the next few years, will sterling savers turn on you with a counter claim? The gain from forex is worth 3.8% on the initial value of the loan book, and about 3.4% against the current value less set-off and write-off - it is not a small sum by any means.
I imagine that many creditors are aware of the postion of dollar-savers in this debacle, but they didn't make it that way and really don't need it re-emphasising because there is nothing anyone can do about it! We've all lost small or large fortunes and what we eventually get back is probably going to be much more than we ever imagined back in dark December 2008. It is very unfortunate for you that the authorities could not have devised a solution to the currency situation, but people deposit in various curencies for different reasons, no one can predict where exchange rates will be in the years ahead so I guess they just have to fix them on the day of failure and then see where Lady Luck takes them - and that's what you have to do too.
Ice
Abso..er..lutely
"We've all lost small or large fortunes and what we eventually get back is probably going to be much more than we ever imagined, back in dark December 2008."
Absolutely! Of course, I for one am very pleased by the way things have eventually turned out -- and are turning out. Probably because our expectations, back in the Dark Days of December 2008 or so, were just about zero.
Now I am not being cynical or "negative" -- just making a philosophical point: I wonder how many of us at that time would have jumped for joy (as we now do) if we'd been told, "Hey KSF's gone bust. But never mind, you'll eventually get back at least 83 percent...."
You'd probably retort, "Wait a minute -- what about the OTHER 17%??!!"
Yes, it is funny what a difference three years can make: Reduced expectations is just one of the changes.
This of course, in no way is intended to denigrate all the very hard work done by those in the background, including so many unpaid volunteers. I, for one, am extremely grateful.
Because, yes, back in those days, I felt very gloomy indeed. Not that I even considered turning it all in -- it's only money, after all. But I wonder how many people involved with very substantial losses did think of giving up....
Yes, 83% saves you having to kick yourself, at least.
Oncebitten
WEll there was one person who committed suicide over this, which should not be taken lightly and none of it being our Fault, its all relative in losses..
We SHOULD GET 100% OF OUR MONEY BACK AND MORE for the losses and interest!
Some of us have been to HELL and back because of other peoples GREED and lies..
Banks spring to mind in that score!
Aurora
Ice Comments
I am one of those not very happy at the GBP rate used to convert our USD deposits.
Am even more mad when I see that JL has taken futures on forex ... why couldnt they do that on the day or the immediate days after the failure to protect those non GBP deposits !? !?
Well the answer is that we were toyed around for months with SOA and what not and JL probably did not have the authority to do anything like that (I hope he did not have authority...).
In the mean time GBP crashed and non GBP depositors are left (a bit) (very) short depending on your currency of choice and what you do with the payments.
But if you can afford it, you can keep the GBP and invest them and convert when the rates are back to more acceptable levels. And, we never know, the next payment (announced today!) might be paid out at a higher rate and we make a profit.
Whatever is your situation there is no better word that THANKS to say to Gordon and Ice to keep us inform so that we can make better decision.
Thanks Gordon, Ice.
Luc
You think that they weren't aware?
What do you think they were doing?
Spot on Ice
Thanks for making that point Ice.
Gordon 45 and yourself do so much good work informing the rest of us (both bad and good news and often up for debate between the two of you).
Does Ianhkhi think Gordon is some financial scivvy who should be servicing all our different informational needs? If Ianhkhi needs specialised financial information and interpretation then he should pay for it - or accept that which Gordon and Ice give up their free time to provide to give the rest of us a clue of which way the tide is running.
'Ungrateful' does not come close to describing Ianhkhi's attitude.
To Icecrusher
Ice,
Your comments are most appreciated.
I feel for all of my DAG Chat colleagues, like you yourself do, but as you said we did not make the rules, we only try to estimate and guess as best we can using them, in order to hopefully help others, to look forward to what they might expect over the term of the Liquidation.
And your figures to Ian appear to agree with what he himself has quoted - down 8% in USD as against the GBP.
Thanks once again,
Gordon 45
Well said Ice!
Well said Ice!
THANKS GORDON
Many thanks for all your hard work again. I'm sure many of us read the liquidator's staements and then look straight to you for your comments - much appreciated.
James
thank you Gordon
Echoing James' sentiments.
You should be paid by the JL's for being their information officer Gordon. Communication is certainly not a skill they have honed.
Thanks again Gordon
Rob and Wendy