Ann: HALFYR: BIT: BIT - Half Year Report

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					BIT
20/06/2014 08:30
HALFYR

REL: 0830 HRS The Bankers Investment Trust Plc

HALFYR: BIT: BIT - Half Year Report

Page 1 of 14
THE BANKERS INVESTMENT TRUST PLC
Unaudited results for the half year ended 30 April 2014

This announcement contains regulated information

Interim Management Report

Chairman's Statement

Review of the period including material events and transactions
In my statement within the 2013 annual report I commented that, after such a
strong year for equity returns in 2013, it would probably be sensible to be
cautious for returns in the year ahead despite the more encouraging economic
picture. I also outlined the broad positive backdrop that equity markets are
now operating in compared with the more recent period of economic recession
and financial sector woes.

It is thus slightly disappointing to report a fall in Bankers net asset value
per share of 2.2%, compared to a FTSE All-Share Index return of 1.0% during
the same period.

The key contributors to these figures are currency moves and the shift across
global markets toward the larger capitalised stocks and away from the
mid-sized companies to which Bankers has a greater exposure.

As has been the trend over the past few years Bankers has been gently
reducing its exposure to the UK market. The resulting increased overseas
market and currency exposure has worked well for us over this longer period
but, in the immediate period under review the strength of Sterling has
reduced overseas market returns when converted to Sterling.

Overall global economic recovery appears to be becoming more established with
the economies of the developed markets leading the way. North America and the
UK have been reporting better economic data for some time allowing for the
reduction of special measures in both economies (quantitative easing and low
interest rates) to be actively discussed by the respective central banks.
Economic activity across continental Europe has been less robust and the
focus of central bankers in this area is increasingly upon the risk of
disinflation (lower, but still positive, increases in inflation) turning to
deflation (falling prices of goods). Against this backdrop we would expect to
witness continued central bank stimulative measures.

In the Far East, Japan has continued to see economic growth and, for the
first time in almost a generation, a positive set of inflationary numbers.
The experiment of "Abenomics" begun two years ago, which had at its core a
lower value of the Yen, is beginning to have some noticeable impact on both
the export led economic recovery and also the domestic landscape. Despite
this fundamental economic shift, returns from the Japanese equity market have
been very disappointing with a decline of approximately 10% being reported
during our half year period. Similar, although less pronounced returns have
been reported from other, smaller, Far Eastern markets.

Emerging market economies have continued to report positive economic growth
figures albeit below some of the more extreme expectations at the beginning
of the year. Again, equity market returns have been unforgiving with most
emerging markets falling in value during our half year.

During this period I am pleased to be able to report that the majority of our
regional managers outperformed their local indices on a relative basis. The
two exceptions were Europe, where we are conservatively positioned in
Northern European companies and have thus not participated as much from the
Southern Europe bounce, and in North America where our Portfolio Manager has
undertaken a reorganisation of the investment portfolio. The focus of this
reorganisation is to seek a more growth orientated exposure to some key
equity sectors and stocks which we expect to produce good results in the
longer term.

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THE BANKERS INVESTMENT TRUST PLC
Unaudited results for the half year ended 30 April 2014

In our Portfolio Manager's report at the year end we highlighted the
valuation anomalies within the local Chinese 'A' share market. This market is
only available to international investors with the appropriate licences in
place. Bankers has such a licence and at the half year our US$25 million
investment in this market had been completed. This will now be run as a
separate portfolio within the wider portfolio and it is anticipated that good
income and capital returns will be generated over the longer term.

Revenue Return and Dividends
Underlying dividend growth across the portfolio remains positive at a local
currency level albeit that Sterling strength has impacted the figure after
translation. In addition the reorganisation of the North American portfolio
has seen an initial drop in revenue being generated from this region. The
dividend growth prospects, however, have been enhanced.

Our significant revenue reserve position enables us to take a longer term
view on portfolio construction in order to better position for higher
dividend returns in the future. As such we are able to re-iterate our
forecast to pay a minimum of 14.7p per share for the full year, an increase
of 4%. It is our intention to pay a second interim dividend of 3.7p per
ordinary share on 29 August 2014.

Audit Tender
We stated in the Annual Report that the Audit Committee would hold a review
of new auditors to replace our long standing relationship with
PricewaterhouseCoopers LLP (PwC). Having met and reviewed a number of
potential successors, the Audit Committee recommended that we move our audit
relationship to the Investment Trust team at Grant Thornton UK LLP. This will
be with effect from 18 June 2014.

I would like to take this opportunity to thank the team at PwC who have
served the Company extremely well over the years. It is the end of the
longest professional relationship that Bankers can identify, which can be
traced back to our launch in 1888.

Outlook
Despite the lack of progress during the first six months of this year we
remain positive towards equity markets in general. Corporate sentiment
remains sound which continues to be demonstrated in corporate results,
management statements and dividend increases. As has happened in the past
equity supply in the form of new issues has helped fill some of the demand
for equities at the margin but despite this we remain committed towards
global equity markets as an asset class. Valuation levels are not excessive
in most major markets and in some of the smaller markets recent falls have
started to create some attractive opportunities.

Richard Killingbeck
Chairman
18 June 2014
End CA:00251809 For:BIT    Type:HALFYR     Time:2014-06-20 08:30:24