Humm Valuation - What is Sensible, page-27

RMC is a non-bank lender (TGA was too but now a shell). And the transaction was for the SME commercial lending book.

So a comparison of price to HUM is relevant given same space.

Strictly speaking one should have done on the individual books but the price disparity is already obvious (and exact info not available given they never split the funding side).

TGA book was priced at 1x NTA or just under whereas HUM as a company is a lot less.

And that's before you consider the quality of HUM's commercial book.

TGA commercial book is/was negative growth and loss-making, whereas HUM commercial book is growing significantly and profitable (and with the extra kicker of repricing the back-book in 2HY increasing profitability). On that basis it should command a premium IMO.

The question is what do you price HUM consumer book at?

The infamous LFS deal was 1.8x NTA but that was a different macro environment and different structure.

Anyway, today we with went back into the 50s, will we get a similar run into results like we did in 1HY?
And will the actual results deliver?
There's no point being on a low P/B if you can't deliver FCF & divis - market will price accordingly.