Hello there and welcome to the Bankers interim results to the half year to April 2025.
Performance in that period was slightly negative from the net asset value total return, -4%, and that was against a benchmark that was -2.6%. But the share price actually performed better, was broadly flattened, plus 0.1%. We also increased the dividend by 2.1% in the period compared to last year. Now the key drivers for performance were really the US markets been a very volatile period this 6 months to the end of April. We obviously had a new administration in the United States with President Trump issuing a slew of executive orders changing a lot of policies from his predecessor, and that created a lot of volatility and uncertainty in the US market. Which also spread out into other markets around the world, particularly related to trade tariffs and the uncertainty therein. We increased our exposure to the US before the election and post the election, and the belief that a lot of Trump’s policies would be market friendly to corporates in particular.
And I think that worked quite well until around about February when I think rising tensions on trade tariffs and worries about the size of those tariffs sort of brought markets down in the second half of that period. So our performance suffered in that first month of November of the period, again, really being underway in the US when it was so strong, and in stock selection also, some of the companies that performed very well are very much tied to the new US administration. And we were thinking more broadly in terms of companies which would prosper, despite some of the uncertainty. And actually from that period in November, throughout the rest of the 5 months, the portfolio performed actually above the benchmark in that period, but not enough to capture the initial loss in November.
Portfolio performance was quite strong in other areas where we are overweight, so Europe and Japan. Japan in particular was a good performer during the period. Smaller companies actually mid-sized companies less related to sort of macro global trends, perform well, things like Shimuzu, which is a construction company, building housing and projects in Japan, perform well. Also NOF, which is a special chemicals firm, performed very well in that period as well. In Europe, it was really financials as it was in America. They were the strongest performing sector, particularly the banks. We increased exposure to banks in this period, so benefited from that stronger performance, and really companies like Unicredit in Italy, BMP, and NatWest in the European portfolio performed well, as did Morgan Stanley in the US portfolio. In terms of portfolio changes, as I said, we increased the US exposure through the period up to Christmas, and then since then it got to about 63% of the portfolio, and we’ve been slicing stocks since then where we still see some uncertainty in the US market, and so it’s down to about 60% today, but that remains underway relative to the benchmark. Elsewhere, as I’ve said, we’ve increased financial exposure has been a key area maintain technology because we still see some great opportunities in many companies there and actually earnings have been quite strong and upgraded through the beginning part of 2025 and relative to some of the more economically sensitive sectors of the world, it still looks very attractive.
So equity markets have recovered most of their losses and are trading very near the February highs, and I think that is the expectation that tariffs will end up at a reasonable level. And then really we can concentrate on some of the more market friendly policies coming through.
I expect the outlook to be positive, actually. I think a lot of economic Indicators outside the US are showing good trends, actually recovering. We’re seeing interest rate cuts which should help market recovery against consumer spending. So we remain in a reasonably positive view of equity markets, but cognizant that there are still some risks that deals are not made and trade tariffs are higher than expected.