Shareholders of five Nigerian banks, namely, Access, Zenith, UBA, StanbicIBTC and Guaranty Trust Bank, are lining up in wait to hear news of the amount of interim dividends they would be paid this year by their banks and they should be hearing news anytime soon, a call by Nairametrics suggested Tuesday.
Nigeria banks closed their half year on 30th of June and are being expected to start releasing their financials for the period this month with possible announcement by the managements of board approvals for interim dividends to be paid, according to other analysts familiar with the process, who spoke to Businessamlive on the issue.
The historical antecedents of the five banks named points to the likelihood of the payments happening. They have been identified in the past to be keen to pay out interim dividends on the back of profits made in the first six months of the year and would not likely stop this year.
“They would like to keep to this tradition, especially where it is obvious that they have made reasonable profit,” said one analyst who did not want to be named for this story because he covers the sector for his firm, but he added that “they would like to continue to be seen as investor-friendly institutions who like to share the fortunes seen through the profits that they make.”
Records show that Access Bank between 2013 and 2016 consistently paid an interim dividend to its shareholders, developing a culture that has seen investors come to expect this at end of every half year. A 25 kobo per share interim dividend has been paid each half year since 2013.
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The bank has already given hint of this happening in a notice the bank sent to the Nigerian Stock Exchange earlier in the month. The notice suggested the possibility of the bank’s directors considering paying an interim dividend. And the numbers would back this up as earnings per share and profit after taxation for the first quarter were up. Profit after tax rose from 19.4 billion in 2016 to N26 billion in 2017. Earnings per share also increased from 67 kobo in 2016 to 91 kobo in 2017.
Shareholders of Zenith always look forward to half year with high expectations. And the bank often does not disappoint. It has filed a notice with Stock Exchange informing it that the directors are considering possible interim dividend payment. Last year it paid 25 kobo per share as interim and its results for the first quarter puts it in a good position to pay out this year. For instance, profit after tax increased from N26.5 billion in quarter one of 2016 to N37.4 billion in quarter one of 2017, while earnings per share increased from 84 kobo in Q1 2016 to 119 kobo in Q1 2017.
As for the shareholders of UBA, they would be riding on the back two pieces of information. The first is that last year UBA paid out 20 kobo interim dividend per share and the second is that in a notice issued for an incoming board meeting, the bank indicated that payment of the interim dividend would be considered. The bank’s first quarter results were positive with profit after tax increasing from N16.9 billion in 2016 to N22.3 billion in 2017. Earnings per share also increased from 49 kobo in 2016 to 63 kobo in 2017.
Last year was a tough one for StanbicIBTC following the prolonged delay in the release of its results. It paid a paltry dividend of five 5 kobo per share. But analysts say with the stock back on the winning track and performing better than many stocks, things look good for an interim dividend payout.
Besides, analysts point to a culture at the bank of paying half year dividend. And with an impressive first quarter performance, it is believed that this tradition will be maintained. Profit after tax rose from N7.7 billion in 2016 to N16 billion in 2017, while earnings per share increased from 68 kobo in 2016 to 155 kobo in 2017.
Another bank whose shareholders are on queue for possible dividend payment is Guaranty Trust Bank. It has paid interim for 10 years without fail. It is also known in the past for issuing bonus shares at the end of the year to shareholders.
Last year, the bank paid out 25 kobo per share as interim and shareholders are expectant that it would repeat offer the same half year goodies. The bank’s profit after tax increased from N25.6 billion in 2016 to N41.4 billion in 2017 quarter on quarter. Earnings per share for the first quarter show a huge increase from 90 kobo in 2016 to 147 kobo in 2017.