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Liontrust Blog

Mark Williams, Asia: Country visit notes - China (Shanghai, Wenzhou and Zhuhai)

  • The aggressive growth of the shadow banking sector in recent years has led to speculation over the potential consequences for the Chinese economy.
  • Our view is that the scale of this growth in lending and the corresponding rise in non-performing loans (NPLs) has not yet reached a level that will provide risks to the overall financial system, and is unlikely to do so.

Samantha Gleave, Cashflow Solution: Buying back into banks

We have added shares in Banco Santander to the Global Income Fund and the European Growth Fund. This is one of the very few European banks which met our Cashflow Solution investment criteria during the recently-concluded annual review of companies’ report and accounts, marking the first time we have added a retail bank to our funds for a number of years. The UK banks sector is either loss-making or, for those banks that are not, there is not yet enough evidence of significant restructuring, in our view.

 

A selection of UK and European banks were flagged up during this year’s review, primarily due to the level of balance sheet restructuring seen in the sector – this is one of the quantitative elements which forms part of our cash flow screen. The banks that appeared on our screen as undergoing significant restructuring included Barclays, Deutsche Bank, Credit Agricole, Banco Santander and UBS.

Disclaimer

Any opinions expressed should not be construed as advice for investment in any [product or] security mentioned or which may form the underlying content of any topics discussed in this blog.  The information and opinions provided in this blog take no account of the investors’ individual circumstances and should not be taken as specific advice on the merits of any investment decision.   Any opinions or information provided has been based on sources we believe to be reliable at the time of this blog’s preparation: no representation or warranty, express or implied, is made as to the accuracy, reliability or completeness of such information.  Neither Liontrust, nor any of its partners, employees, representatives or agents accepts any liability whatsoever for any direct or consequential loss howsoever arising, directly or indirectly, from any use of our research or its contents.

Liontrust, its partners and/or employees may have had, have or will have positions in the securities (or related financial instruments) which are those referred to, or those underlying the content discussed in this blog.

Any individual who chooses to invest in any securities should do so with caution. Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested.  Always research your own investments and consult with a regulated investment advisor or licensed stock broker before investing.

Shares in companies referred to may be relatively illiquid and hard to trade, therefore riskier than other investments and there could be a large bid/offer spread, so if you need to sell soon after you’ve bought, you might get less back than you paid. This can make them riskier than other investments.