View more on these topics

Woodford rules out banks for three years

Invesco Perpetual income guru Neil Woodford believes banks are unlikely to become an attractive investment for the next three years.

He says despite many banks being in a poor condition, further losses are almost inevitable. He says: “It is clear that now is not a good time to be in bank equities as we are not sure of the quantum of bad assets. Following the announcement of the Government’s asset protection scheme, we have now seen most of the ammunition fired in an attempt to recapitalise the banks.

“The next question is nationalisation, although some may argue it has already happened, and if the need is there, I am in favour of it taking place.”

Woodford sees no sign of green shoots in the market and says the economy is set for a prolonged adjustment lasting three to four years. He predicts house prices could fall by up to 20 per cent further.

He says the Investment Management Association’s decision on yields in the UK equity income sector will not affect the running of his funds, having already moved sector. He adds: “It is a decision that could end up being unwound in 12 months by the IMA. We are confident that we will be able to deliver on dividends although there will be some cuts from the likes of BT.”

Baronworth Investment Services director Colin Jackson says: “I am not one to argue with Neil Woodford but I cannot see how anyone can make a long-term call on the banks, given this environment. I think those willing to take a punt should only go in if they can afford to lose the money.”


Make a difference

It was a matter of luck I suppose that I began a career in the financial services industry. Home on a 72-hour pass from my posting in Germany as a national serviceman, a mate said his girlfriend’s boss was looking for a new recruit. It was a good job – you got a car and played golf most days.

Rayner Spencer Mills: Why we rate the Artemis Global Growth Fund

Ken Rayner and Graham O’Neill from RSM explain why they rate the fund, its investment process and how it can be used in a portfolio. The Artemis Global Growth Fund became a RSM ‘rated’ fund earlier this year. In this video, Ken Rayner and Graham O’Neill explain the fund’s investment approach, why they rate it, […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm