Bankers Investment Trust To Mull How To Refinance Pricey Debenture

Alliance News
  • January 19th, 15:56
  • Last Updated: October 10th, 12:27

**Bankers Investment Trust To Mull How To Refinance Pricey Debenture**

LONDON (Alliance News) – Bankers Investment Trust PLC is to consider what sort of debt it will use to replace its expensive GBP10 million 10.5% debenture ahead of its maturity, with the restructuring of its debt expected to be a plus for its revenue account.

Fund Manager Alex Crooke said the current cost of borrowing is significantly lower than the rate it pays on its maturing debenture, whether the trust decided to borrow short or long.
“The revenue account will benefit from the restructuring of the debt facilities, and should offset some of the pressure exerted by sterling’s strength over the last year,” Crooke said.
“Despite the rise in sterling, and the increased allocation into the US, the revenue earnings per share rose by 4.2% which reflects our efforts to invest in companies with the potential to grow dividends and an increased level of special dividends,” the fund manager added.

Crooke said it is likely that special dividends will remain a feature of markets because many companies have been reducing debt levels, meaning they are more disposed to returning cash to shareholders.
The fund manager was commenting as the trust said net Asset Value total return per share, which includes dividends reinvested, rose by 4.2% to 23.17 pence in the year ended October 31, 2014, while the FTSE All-Share Index total return, again including dividend reinvestment, rise by 1.0% to 5,380.7 pence.

The trust’s NAV per share rose by 1.5% to 596.0 pence over the year, compared with a negative 2.3% return for the FTSE All-Share Index.
“In my report to shareholders last year I suggested that after the strong year in 2013 it might be sensible to be cautious for the prospects for global equity markets in the year ahead, albeit that many positive factors remained in place,” Richard Killingbeck, chairman, said in a statement.
“As the above net asset value return suggests the confidence that I expressed has not been demonstrably translated into returns for shareholders despite a strong performance from the North American equity markets. Elsewhere the majority of global equity market returns, when adjusted for currency movements, have been negative for a sterling investor,” Killingbeck said.
The trust also forecast a dividend per share for the year ahead of not less than 15.5p per share, an increase of 4.7%.
Bankers Investment Trust has also appointed Grant Thornton UK LLP as its new auditor, replacing PricewaterhouseCoopers LLP, the first time the trust has changed auditor in its 126-year history.
At its last annual general meeting, shareholders gave approval for PricewaterhouseCoopers to remain as auditor until another could be appointed.
By Samuel Agini;; @samuelagini
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