This archive report was first published on 25 June 2020.
Published on June 25, 2020, Standard Chartered Kenya has announced a revised dividend policy for the year ending December 2019, offering shareholders a total return of 14.5 percent.
The lender will ask shareholders to approve a new dividend of Sh7.50 a share plus a bonus issue of one share for every 10 held, replacing the earlier declaration of a Sh15 per share straight cash dividend.
According to analysts at Genghis Capital, the new arrangement works out to a return of 14.5 percent for the year, calculated at present prices.
Analysts noted that the review of 2019 dividend from Sh15 to Sh7.50 plus a 1:10 bonus gives investors a yield of 4.5 per cent on the cash dividend plus 10 per cent stock dividend (before price dilution by the bonus shares).
“While investors were counting on the cash dividend…this translates to a return of 14.5 percent, significantly better than the 8.9 percent cash dividend yield as previously recommended,” said Genghis in its weekly report.
The bonus issue will see shareholders get a total of 34.35 million new shares, valued at Sh5.71 billion.
The Sh7.50 dividend will give them another Sh2.58 billion in cash payout.
Several banks have decided to alter dividend payments for the 2019 financial year to protect capital positions and support lending as the negative economic effects of the Covid crisis continue to manifest.
