NAIROBI, Kenya, June 21- Standard Chartered Bank has cut its shareholders’ dividend from Sh15 for every ordinary share to Sh7.50 citing economic crisis brought about by the outbreak of the coronavirus disease.
The bank’s secretary Nancy Oginde in a notice announced that the decision followed reviews from the board on how the business was performing owing to the pandemic that has slowed down economic activities.
“The board after careful consideration has decided to vary its recommendation and instead recommend to the shareholders of a final dividend for the year ending December 31 2019 of Sh7.50 for every ordinary share of Sh5.00,” Oginde said.
Additionally, should the stakeholders agree to the board’s proposal through a virtual annual general meeting scheduled for July 24, the shareholders will also receive a bonus share issue.
The lender has proposed one share for every 10 fully paid up ordinary shares to shareholders registered at the close of business on April 27.
“The Board fully recognizes the importance of dividends to its shareholders. However, varying shareholder distributions at this time will allow the company to maximise its support for individuals, businesses and communities in which it operates,” she added.
The announcement comes at a time when many lenders have resolved to withhold their dividends in order to protect the firms from further shocks brought by the pandemic.
NCBA was the first bank in East Africa to pull its final dividend for last year of 1.50 shillings per share due to the coronavirus crisis and instead offered investors a bonus share issue of one for every 10 held.
Equity followed suit withdrew its recommendation of a Sh9.5 billion dividend payouts to its shareholders.
For KCB stakeholders they received a Sh11.1 billion total dividend payouts to shareholders for the 2019 financial year, which signified a sustained return to shareholders amid a tough operating environment.
Standard Chartered Bank reported a marginal 1.7 per cent increase in net profit in the year ended 2019 to stand at Sh8.2 billion from Sh8.1 billion it recorded in 2018.
In the same period, the net operating income increased slightly, from Sh28.6 billion to Sh28.7 billion.