ING holding here so far. I have to ask you...I am sure you noticed NBG has crossed below a buck ADR...What is your opinion of the outcome...it looks bad for NBG shareholders. More talk coming on big haircut...
Since you say you hold large amount of NBG...I assume you are following NBG events and price movement...
I would appreciate your feedback on what you intend do with your NBG share stake. Will you add...drop some shares..or continue to hold...I mean, NBG is a screaming buy, or we are wiped in the common.
I always try to be cautiously realistic on my posititions. I never sell just because the price goes down without significant change in fundamentals. But if they do, I usually start lighten, and get out in 2 months, at the tops of the stohastic curve.
I think NBG fundamentals have not changed. They operate 40-50% of their business in Greece, a deeply indebted and almost bankrupted state, and 50-60% in other states where they just do fine. Their price discounted a total banktrupcy.
I dont think it will happen. I still believe the EU will restructure Greek debt (the total is cca. $1 Trillion, and this TooBigToFail amount would bankrupt half of Eu banks....so they MUST keep them above water for a long time... and the EU TARP is working.) as long as this problem will find a longterm solution.
At the current price their turkish subsidiary, Finanasbank alone is worth at least 2 times their total market cap.
2) NBG also has options to avoid banktrupcy. They might simply move their headquarters to another country (Macedonia, Bulgaria, Turkie ?). And slowly sell the greek bonds at the best possible points. Or participate in the program Eu is leading.
There are other ways to get greece out of debt. See the Brady bonds, when the US rescued LatinAmerica's banks 25 years ago.
3) I hold my position. And will add as the final solution comes up.
If you feel really uncomfortable, do as I suggested at the beginning: sell step-by-step, 20% at a time, at the tops of the stohastic curve.
4) I believe that banking is trading on emotion rather than fundamentals. When the recession in March 2009 was at its peak, banking was at historical lows. Investors who owned stock in banks lost nearly everything during the recession. So naturally people are scared at the thought of another recession. And now sell in a post-traumatic panic at any sign of recession.
5)I do not believe this economy is going to experience another deep or long recession based on the data we currently have regarding economic growth. We are experiencing a slow-down in economic growth. And thats it.
I believe that most investors agree that currently bank's stocks are (extremly?) undervalued, and that will rise much higher at some point in the future. I am very bullish on some banks, including ING and NBG (and JPM, DB, C) and I believe to get spectacular gains within 3 years from these positions.
However, during the immediate future these stocks look like a great risk of loss because of investor (extrem?) skepticism when it comes to the future of banks.