THUR, MAY 16 2019-theG&BJournal-Nigerian big Banks have continued to reward shareholders from distributable profit even amid a sluggish economy and low yield environment.
Zenith Bank, Guranty Trust Bank (GTBank), Access Bank, and First Bank Holdings, have paid a combined N191.12 billion in dividend to shareholders as at 2018 financial year, this represents a 1.74 percent increase from N194.45 billion declared in 2017.
The cumulative payout stood at 34.02 percent as at December 2018.
Banks have been recording steady growth at the bottom line (profit) since 2017, but the major drivers of profit in 2018 were foreign exchange gains, income from internet banking, and a reduction in impairment charge.
A breakdown of dividend payment shows Zenith Bank paid out N78.50 billion in the period under review, this compares with N76.93 billion asa at December 2017.
Guaranty Trust Bank (GTBank) paid out N72.10 billion in the year ended December 2018, while payout was nil.
Access Bank’s gave the sum of N8.88 billion to shareholders from distributable profit, a reduction of 37.40 percent from N14.22 billion paid in 2017. Its payout ratio fell to 15.15 percent in December 2018 from 23.66 percent the previous year.
First Bank Holdings paid out N9.33 billion as at December 2018; this represents a 4.15 percent increase from N8.97 billion as at December 2017. The lender’s non-performing loans have been improving after the precipitous drop in the price of crude oil hindered customers from meeting their obligation.
United Bank for Africa paid out a dividend of N22.30 billion for the year ended December 2018 as the lender recorded a double digit growth in earnings.
However, the dividend announcement by big banks have not translated into share appreciation and attractive valuations as investors are yet to be convinced that President Muhammadu Buhari’s policies will reflate the economy despite the conclusion of the elections.
Foreign investors’ participation in the equities market declined to 51 percent of total transactions from 53 percent recorded in February, according to Nigerian Stock Exchange (NSE) data on Domestic and FPI Report for the month of March.
The report also showed a net outflow of N4.3bn (US$11.9m) for the month of March, lower than N11.1bn ($30.8m) recorded in February.
The Banking Sector Index shed -9.30 percent since the start of the year, while the Nigerian Stock Exchange (NSE) and All Share Index (ASI) has a YTD of -10 percent.
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