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Best Banks for Loans on/for Shares
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mwanahisa
#11 Posted : Tuesday, November 16, 2010 12:32:05 PM
Rank: Elder

Joined: 6/2/2008
Posts: 1,438
The Bank would normally get it back straight from the Issuer, but there could be variations to this.
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VituVingiSana
#12 Posted : Tuesday, November 16, 2010 1:10:25 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,350
Location: Nairobi
My 2 cents wrote:
And then what if you don't get all the rights applied for? Do you return the excess cash to the bank?
Yes. The bank has a 'pledge' form that essentially means that any funds 'paid' for shares not allocated to me are 'refunded'.

An alternate is getting a Letter of Guarantee which means the Bank will only pay for what you are allocated i.e. no need for refunds BUT there is a charge for the LoG.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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mgeman
#13 Posted : Tuesday, November 16, 2010 1:16:46 PM
Rank: Member

Joined: 11/5/2010
Posts: 131
Location: kenya
Shouldnt margin trading be more suitable. Kwanini hatuna hii kitu?
I am an African

-Thambo Mbeki Speech
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Sufficiently Philanga....thropic
#14 Posted : Tuesday, November 16, 2010 1:35:33 PM
Rank: Elder

Joined: 9/23/2010
Posts: 2,225
Location: Sundowner,Amboseli
VituVingiSana wrote:
The Merchant wrote:
VituVingiSana wrote:
The Merchant wrote:
My 2 cents wrote:
@VVS please let your many followers know that borrowing to purchase shares should come with a caveat.

Is he borrowing to purchase shares or using shares to borrow? I think I understood it as the latter.
@vvs...go for I&M bank. They never surprise you.

Both. Borrowing against existing shares to buy 'new' shares.

*** There are huge risks to borrowing.

Wow! Leveraged trading right there. Your strategy must be superbly sound. Admirable!Applause
No. I am 'trying out' banks to be ready for KPLC's large Rights Offer. The 40% Rights + Purchased Rights &/or Additional Shares means I need cash!
[I am not selling any of my current shares. That might have been a better idea but I am conservative & also think D&B will flip the Rights to a few Institutions leaving Retail Investors with very few shares/Rights]

am also grappling with the same problem, where to get the cash to exercise my rights! The fact that most of the counters r now flat doesnt help much when you think of selling them to creat liquidity!
@SufficientlyP
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VituVingiSana
#15 Posted : Tuesday, November 16, 2010 1:35:47 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,350
Location: Nairobi
I am NOT interested in the thread being about the merits or de-merits of taking a loan to buy shares... Please stick the main point here...

What banks offer loans to buy shares using shares as collateral?
What rates? What conditions? Any other RELEVANT information.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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My 2 cents
#16 Posted : Tuesday, November 16, 2010 1:52:32 PM
Rank: Veteran

Joined: 6/2/2010
Posts: 1,090
Why not just go for a simple unsecured seeing as the interest rates you mention from the banks above are not that low despite having shares secured. Stancharts unsecured goes upto 4million, 60months, 16.25%
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VituVingiSana
#17 Posted : Tuesday, November 16, 2010 2:10:03 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,350
Location: Nairobi
My 2 cents wrote:
Why not just go for a simple unsecured seeing as the interest rates you mention from the banks above are not that low despite having shares secured. Stancharts unsecured goes upto 4million, 60months, 16.25%

Interesting but I am not 'salaried'. I have my own business so income varies substantially year to year... I will look into it. Thanks.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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KIRTI
#18 Posted : Tuesday, November 16, 2010 2:24:40 PM
Rank: Member

Joined: 8/17/2010
Posts: 116
I suggest to take O.D. Facilities instead of loan. If you take loan then you have to pay fixed instalment every month. If you wish to pay earlier then they will charge you penalty. i am negotiating with bank & they agree to give me O.D. facility against CDSC account @ rate of interest 14.75%, commitment fee 1%, Pledging of share at CDS Kshs 1000. period 1 year.
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VituVingiSana
#19 Posted : Tuesday, November 16, 2010 6:53:32 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,350
Location: Nairobi
KIRTI wrote:
I suggest to take O.D. Facilities instead of loan. If you take loan then you have to pay fixed instalment every month. If you wish to pay earlier then they will charge you penalty. i am negotiating with bank & they agree to give me O.D. facility against CDSC account @ rate of interest 14.75%, commitment fee 1%, Pledging of share at CDS Kshs 1000. period 1 year.
Which bank? What % LTV? You are right about the Installment so I am asking for initial moratorium for Principal...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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KIRTI
#20 Posted : Wednesday, November 17, 2010 7:17:15 AM
Rank: Member

Joined: 8/17/2010
Posts: 116
If you go to small bank like Giro Bank, Prime Bank, Imperial Bank, ABC bank. they will give you OD facility against your CDS account. They will charge only 1000 for pledging of share. 50 to 60% LTV. you can negotiate with them.
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