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DBS vs OCBC and UOB - Part 2

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Old 30-08-2018, 09:11 AM   #1
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DBS (SGX:D05) vs OCBC (SGX:O39) vs UOB (SGX:U11)

Kinda weird that DBS shares price is performing so differently with the other 2 local banks for today. Any ideas for the different direction?

Last edited by pcmdan; 29-07-2020 at 08:06 AM..
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Old 30-08-2018, 09:11 AM   #2
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Old 30-08-2018, 09:11 AM   #3
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This is a continuation thread, the old thread is here
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Old 30-08-2018, 09:11 AM   #4
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Eg. you own 1000 OCBC shares.
Dividend is 20 cents.

Option 1: Take $200 cash. You get $200 cash in your bank account.
Option 2: Take scrip at $10.15 a share. $200 dividend by $10.15 = 19 shares. You get 19 shares making you have 1019 shares and no cash payout.

Note that scrip issuance dilutes existing shareholders. In order to maintain your percentage ownership of the company, you must take scrip. If you do not, your stake would be diluted as the company now has more outstanding shares issued. This is a reason why a scrip is not a true dividend.

The extra 19 shares have to be sold in the unit share market which has a different share price from the mainboard as it is not in the normal board lot of 100. Of course, you can keep taking scrip till you have a standard lot of 100.

Personally, i just take cash for various reasons. I do own a small amount of OCBC shares.
Thank you,does this mean it's the same as a rights issue?
Assuming I don't buy new shares through this, when you say my percentage ownership is diluted, does it mean that for holding the same amount of shares, in future I will get less dividend? (Assuming the dividend payout per share is the same)?

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Old 30-08-2018, 09:25 AM   #5
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Thank you,does this mean it's the same as a rights issue?
Assuming I don't buy new shares through this, when you say my percentage ownership is diluted, does it mean that for holding the same amount of shares, in future I will get less dividend? (Assuming the dividend payout per share is the same)?

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Rights issue and scrip dividends are not the same.

Rights issue is for company to raise capital through selling of more shares.

Scrip dividend is a plan for shareholders to reinvest in the company. In a way, the company preserves their capital instead of distributing dividends.

If you don't choose scrip, the impact of dilution is going to be very minimal.

Assuming all shareholders take scrip, impact is just a factor of the % equivalent to the dividend yield.

As a shareholder, you choose scrip if you believe in the company by reinvesting in the company.

You take cash if you want to invest elsewhere or if you need the money. Don't worry about dilution about through scrip dividends. Number of shares can still go down if the company does buybacks.
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Old 30-08-2018, 09:30 AM   #6
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Bro suggest u go read more about this 2 man..
Thank you,does this mean it's the same as a rights issue?
Assuming I don't buy new shares through this, when you say my percentage ownership is diluted, does it mean that for holding the same amount of shares, in future I will get less dividend? (Assuming the dividend payout per share is the same)?

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Old 30-08-2018, 09:30 AM   #7
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Ocbc has done share buybacks regularly , so dilution is not a major issue.
And DRP is probably not very significant too.
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Old 30-08-2018, 09:43 AM   #8
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In #8.....huat huat huat!!!







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Old 30-08-2018, 10:12 AM   #9
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I still have 81 shares @ $10.07 & my wife 40 shares @$9.60 from previous DRPs . These also collect DRP.

So I accumulate 81+ another 38 DRP shares soon .
I will sell my 2100 shares at one shot later with 20 shares left for future DRP accumulation.
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Old 30-08-2018, 11:43 AM   #10
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Kinda weird that DBS shares price is performing so differently with the other 2 local banks for today. Any ideas for the different direction?
all shrink in fear liao la over their PAPER gains………..only I gave my position. so what if i was wrong in 1 counter.
my realised profits oredi in bank account and re-invested elsewhere.

many back cannons shout loud loud………….common human trait.
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Old 30-08-2018, 04:35 PM   #11
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For OCBC dividend ($20c) to be paid in Oct, OCBC is now offering to reinvest into its share at the price of $10.2. It seems a good deal. But how about the odd number shares generated? Must I sell seperately via Unit Share Market, with extra cost?

Is it same for odd number shares inside SRS account, also same and must sell via Unit Share Market?

Last edited by fun4life; 30-08-2018 at 04:39 PM..
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Old 30-08-2018, 06:47 PM   #12
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Whatever... ur own money, as long as u happy can already. But I still think it's funny to sell at 20, only to buy back at an even higher price of 25.

That's e main point I was trying to bring across. Nvm if u think otherwise or didn't catch that. Bye.

That’s what u are : bragging about paper profits!
Moreover, thanks for the compliment that u think my level of $25 will hold for you to ‘’profit ‘!

If it drops to $19, your PAPEr gain is less than mine.

Now u know talking about paper gains is vanity??!!

Obviously u r a green horn. I bat more and harder at $14 rather than $25. So buying at $14 and selling at $20 to a silly ass is ‘buying high and selling low’ ...... laughing.
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Old 30-08-2018, 06:55 PM   #13
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Round down then.

What if my OCBC shareholding is held via SCB?
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Old 30-08-2018, 11:42 PM   #14
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Old 31-08-2018, 06:28 AM   #15
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Round down then.
So assuming I have 100 shares, the dividend will be $20 and at a scrip dividend issue of of $10.20, SCB only will give me 1 share? Thus effective issue price becomes $20 for that one share.

Last edited by czycius; 31-08-2018 at 06:31 AM..
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