Investors in Access, Zenith, two other banks get N29.7bn dividend
Shareholders of four banks listed on the Nigerian Stock Exchange (NSE) will receive a sum of N29.7 billion in dividend for the half year ended June 30, 2016 despite the severe macro economy challenges.
Given the challenging operating environment and stiff regulatory environment, analysts have expressed that investors in the banking sector may not earn much on their investment for 2016 financial year.
Out of the 15 listed banks on the Exchange, only four banks that include Access Bank Plc, Zenith Bank Plc, Guaranty Trust Bank Plc and United Bank for Africa Plc (UBA) that have declared interim dividend for the period under review. .
According to Business247 News Online investigation, the above four banks announced a profit after tax that rose by 18.1 per cent or N25.7 billion from N142 billion recorded in prior half year ended June 30, 2015 to N167.8 billion in half year ended June 30, 2016.
Zenith Bank Plc of the four banks recorded 28.4 per cent decline in profit while GTBank crossed N70 billion in profit after tax to N77.46 billion, representing an increase of 45.1 per cent from N53.37 billion in prior half year ended June 30, 2015.
For the interim half year reports, GTBank, Zenith Bank and Access Bank proposed N0.25 dividend respectively while UBA shareholders to benefit N0.20 per share interim dividend.
According to our analysis, Zenith Bank Plc is expected to pay 648,725 shareholders N7.85 billion interim dividend while GTBank to pay 336,080 shareholders N7.4 billion.
UBA Plc is giving out N7.3 billion to 76,806 shareholders and 818,664 shareholders of Access Bank Plc are to receive a total dividend of N7.2 billion on September 19, 2016.
Speaking on the dividend, President, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, said the above four banks management should be commended for consistently policy of paying shareholders interim and full year dividend despite macro economy challenges.
According to him, “the interim dividend shows effectiveness in management of these banks. Despite the macro economy challenges, their performances still show resilience and shareholders should be expecting higher dividend by 2016 financial year.
“These banks have shown there is still hope for Nigeria’s economy despite the challenges,” he added.
Market analysts commend banks interim dividend payment despite the macro economy challenges. For instance, the Managing Director of Highcap Securities Ltd, Mr. David Adonri, noted that the interim paid by these banks show good risk management and effective management framework as these banks are working hard to mitigate risk foster by unfolding current dwindling oil prices.
“That is why these banks are reporting impressive profit and dividend payout to shareholders,” he added.
The Managing Director, APT Securities and Funds Limited, Mr. Kasimu Kurfi, said the interim dividend declared would restore investors’ confidence and revive hope in the capital market.
He explained that the banks stocks benefited from price appreciation as GTBank was trading at N26 per share; Zenith Bank (N15.30); Access Bank Plc (N5.70) and UBA was trading at N4.60.
He added that each banks’ stock gain at least 50 per cent after proposing interim dividend.
Group Managing Director / Chief Executive Officer of Access Bank Plc, Mr. Herbert Wigwe, had said, “Notwithstanding the high inflation and the impact of the currency devaluation on cost, operating cost remained stable owing to our cost management initiatives.
“Optimising operational efficiency will remain an imperative for the second half of the year, as we continue to see the benefits of our cost initiatives intensify over the next few months.
“We believe that macro conditions will remain challenging. Nonetheless, our priority in the coming months will be to strengthen our position in the industry; increasing focus on risk and operational efficiency, with customer-centricity at the heart of our strategy.”
Investors in Access, Zenith, two other banks get N29.7bn dividend https://t.co/SiWLRPoOAS
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