For full functionality of this site it is necessary to enable JavaScript. Here are the instructions how to enable JavaScript in your web browser. Australia's big four banks are throwing a picnic for small shareholders. Retail investors are being invited to subscribe for fresh stock in the banks at comparatively low prices. Broadly, all the big four enjoyed a run from until early this year, but since then they have slid quite abruptly.

There were two reasons for the fall. The first was that the Australian Prudential Regulation Authority was tightening the required Tier 1 capital ratios for the big banks to bring them into line with overseas requirements.

The second was that the APRA move prompted a whole chorus of Jeremiahs to begin singing that the banks were overvalued. Maybe they were, but not by much.

The big four look as sound as any in the world. They certainly look stronger than most of the Continental banks which are holding sovereign debt of shaky European nations. Indeed, a cynic would suspect that the higher Tier 1 requirements here are merely an exercise in backside-covering by APRA just in case there is a banking panic at some later time.

Whatever the reason, small shareholders should be celebrating because they can add shares to their portfolio at bargain prices.

Avoid Commonwealth Bank PERLS IX - Intelligent Investor

This is as close as the share market ever gets to Santa Claus. The downside is that few shareholders will be able to pick up many shares, but you can't have everything.

The corollary is that the issue will only dilute shareholders by 4. NAB shares have held well above that price since the new stock was listed on June The ANZ issue announced on August 6 was a small surprisebecause analysts thought it would raise the needed capital through its dividend reinvestment scheme.

Because of those terms, ANZ shares have fallen like binary options trading usa brokers brick ahead of the SPP, which looks like being a bargain entry into the bank. Back in March, Citi Research was a prominent bear on Big Four share prices.

Small shareholders who are chronically kept in the dark like mushrooms can fairly assume that Citi must now think bank shares are a buy instead of a sell. The missing name here is Westpac, which has not announced what it will do. It's a reasonable bet jobs during the stock market crash the market will keep WBC shares low in the hope that they will be pitched even lower in any upcoming issue.

So it's good news for anyone holding any of the big four. If you don't hold any of them, perhaps it's time you reviewed your portfolio. Trevor Sykes has interests in ANZ, CBA and WBC and intends to grab any new shares he can. Fairfax Media Please upgrade your browser. Internet Explorer 7 is no longer supported.

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