Edison reviews The Bankers Investment Trust (BNKR)

London, UK, 31 July 2020

Edison reviews The Bankers Investment Trust (BNKR)

The Bankers Investment Trust (BNKR) has continued to deliver on its twin objectives of long-term capital and income growth, rebounding strongly from the global market declines of Q120 and declaring increased dividends for H120 despite the difficult backdrop for corporate earnings. Coming into 2020, manager Alex Crooke had positioned the trust relatively cautiously with a net cash position of c 3%, which he put to work during the sell-off, boosting the portfolio's long-term total return potential. At the half year the board reiterated its intention to increase BNKR's FY20 total dividend by c 3%, using reserves as necessary, which would secure a record-equalling 54th consecutive year of dividend growth for the trust's shareholders.

At 30 July 2020, BNKR's shares traded at a 0.9% premium to cum-income NAV. The shares had moved to a premium in Q419, although they briefly fell to a five-year widest discount of 12.1% during March before rebounding to a three-year highest premium of 2.5%. The current rating compares with average discounts of 0.5%, 1.4%, 2.7% and 4.6% over one, three, five and 10 years respectively, and BNKR has recently issued shares at a premium for the first time in many years. The trust currently has a dividend yield of 2.2% and forecasts dividend growth of 3% in FY20.

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