Buyback program do helps but in the case of NAB and may be in WBC it is simply to support the price or pump it up so executive shows under their management share price went up or stayed high. NAB did capital raise around $14 and now doing buy back above $30 is the dumbest decision but still if you read AFR or other article people are simply praising the CEO !!!
These banks (NAB, WBC & ANZ) has billions of outstanding shares and to buy even 10% outstanding shares they need to do this buy back for many years so instead of wasting money on buy back they can do small consolidation 2 to 1 and then increase dividend payout. Every time they do buy back they pay brokerages and cost associated with buy back while consolidation will be one off cost and it will remove many small holders as well.
WBC Price at posting:
$26.42 Sentiment: None Disclosure: Held
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