INTEREST COVER AINT GOOD AT CER! Don't allow yourself to be fooled - CER is scrambling to get to ICR = 2.5 times, and LVR = 60%. These are the mimimum conservative lending ratios from what I have seen of lending covenants in other Aus companies. Ruddbank has said it will lend based on conservative credit policies. CER may not meet that definition. I'm very happy to hold CER on a risk weighted basis, and I think they are a bargain, but I ain't feeling gloriously complacent about their profile as a borrower.
CER Price at posting:
4.2¢ Sentiment: LT Buy Disclosure: Held
