9 Banks To Pay Dividend Despite CBN Policy
So, the Central Bank of Nigeria, CBN recently issued a new policy barring commercial banks whose non-performing loans had overshot the legally allowed ratio of 10% from paying dividends this year.
Despite this, some banks will go ahead to pay dividends to their shareholders, a sign that their loan books are healthy.
According to an international research firm, SBG Securities Limited of South Africa, about 9 commercial banks in Nigeria will be able to pay dividends this year despite the new policy adjustment issued by the CBN
The banks include: Guaranty Trust Bank Plc, United Bank for Africa Plc, Zenith Bank Plc, Access Bank Plc, Stanbic IBTC Plc, Fidelity Bank Plc, First City Monument Bank Plc, First Bank of Nigeria Limited and Ecobank.
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The CBN, in a circular recently, amended banks’ internal capital generation and dividend payout ratio.
The apex bank also introduced some conditions for banks to be allowed to pay dividend, which are the Composite Risk Rating of the bank, non-performing loans ratio and capital adequacy ratio.
According to the CBN circular, no bank is allowed to pay dividend out of reserves, while those that do not meet the minimum CAR are also disallowed from doing so.
Also, banks that have a CRR of “High” or a NPL ratio of above 10% are also not allowed to pay dividend.
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