Life after buyback: what next?, page-131

seriously? what - the ones who get/are getting sacked!!

moral is always at the lowest during restructures. Look around - how many branches have closed? How many back office/head office functions have consolidated? The ones that got the boot are agro (most legacy wbc are worse then govt employees!!), the ones that remain are half bitter for losing out on a sweet redundancy or cant handle the heat in the kitchen as their workload has gone up 5 fold!

$5bn cost base reduction needs to come from somewhere.....but i know where all the savings $$$$ will end up - in our pockets!!

my call is ~$3bn of the $5bn (3 yr target) will be achieved this half, with corresponding flow on to our cash earnings. Expect a good re-rate.

We might be hampered a bit by a lower blended nim. As the rates cycle drops then bottoms, blended nim falls and delays to recover in an upward swing enviro, esp given that the cost of funding will naturally outpace the rise in rates (usa rates already risen) so nim compression will likely continue for a year or so (just like how BOQ got hit with a lower nim - but what did the stupid short sighted mkt expect?? ).

After that, we'll get a double whammy - rising nim (higher interest earned on a bloated book built during a low rates enviro - people are leveraged to the hills!!), coupled with a lower/reset cost base -$5bn = will flow like liquid gold to our bottom line and cash $$$ divs...

patience...