Bankers 01 October 2019
Disclosure – Non-substantive Research
This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. With this commentary, Kepler Partners LLP does not intend to influence your investment firm's behaviour.
The Bankers Investment Trust (BNKR) aims, over the long term, to achieve capital growth in excess of the FTSE World Index and annual dividend growth greater than UK RPI inflation, by investing in companies listed throughout the world.
Janus Henderson Investors Ltd
Association of Investment Companies (AIC) Sector
12 Mo Yield
Dividend Distribution Frequency
Latest Market Capitalisation
Latest Net Gearing (Cum Fair)
Latest Ongoing Charge Ex Perf Fee
(Discount)/ Premium (Cum Fair)
Daily Closing Price
Bankers offers investors capital and income growth from a fund of funds approach to global equities. With £1.22bn net assets, the trust is one of the largest and more liquid in the AIC Global sector.
Alex Crooke has been at the helm of the portfolio since 2003, setting geographical allocations for the portfolio, with each of the regional sub-portfolios run by a specialist at Janus Henderson. Each of the major sub-portfolios will typically hold between 25-30 stocks, principally looking for cash generative companies that will grow their dividends going forward.
BNKR has a strong track record for capital appreciation, although this has been more varied in recent times. More notably, the trust’s standout characteristic is its dividend growth track record. The company has grown its dividend every year for the past 52 years, and forecasts another increase of 6% for the current year. Furthermore, the company has revenue reserves equal to 1.8x the annual dividend, giving investors a certain level of confidence regardless of the macroeconomic conditions.
Currently the trust is trading on a discount of 1%.
Looking across the AIC Global peer group, there are an abundance of trusts offering similar global closet tracking approaches with large exposures to the US and growth strategies. However, in the current environment with the US looking expensive and macroeconomic uncertainty surrounding most global markets, the more considered approach that Bankers offers could be a good thing for investors. Furthermore, the fact the value driven approach has not been flavour of the month over the past few years means the managers have been able to pick up an abundance of opportunities at attractive entry points.
Although the trust has a strong long-term track record for delivering strong NAV total returns, the standout characteristic for the company is the exceptional history of dividend growth. The company is in its 53rd year of dividend increases, second to none with deep revenue reserves to continue this going forward.
|Exceptional track record of dividend growth||Value driven approach has meant the trust has struggled to significantly outperform in recent years|
|Differentiated approach relative to peers||Trading at a narrow discount relative to history|