Market report
CUSTOS
The equity market has been moving uneasily. The sharp slide half-way through the month gave investors a nasty moment, and is too recent a memory to be ignored. It is not surprising to see the fasblohable shares—Stater Walker, the electrical giants—slipping back a little.
Bank shares are off the top, but their defen- sive attractions should now commend them. National Westminster, at 67s 6d against a year's high point of 82s 3d, yield 4.1 per cent. (Com- pare the market leader, Barclays, on 3.7 per cent.) Though 1968's figures are unlikely to be equalled for some time, the true earnings yield on National Westminster is now about 15 per cent.
The market rates National Westminster, as it used to rate National Provincial and West- minster before the merger, .on a higher yield basis than the other three oethe old Big Five. This may no longer be right. By merging before the Board of Trade woke up to the implica- tions, they stole a march on Barclays and Lloyds. Now we hear from the Governor of the Bank of England that 'as I see it, the main shape of the deposit banking system is now fixed for a good many years ahead.' He also said that he has 'strongly urged those banks who have merged to lose no time on carrying forward the process of integration and rationa- lisation.' This could at hist release some of the property values on which the banks have been sitting for so long. National Provincial's pro- perties are in the books at f19 million below their market value. National Westminster has already begun to close branches—including some of the District's, a subsidiary—using the south-west as a pilot area.
Previous page
