Bank Muscat board proposes 45 per cent dividend

29/01/2015 11:50 AST

Bank Muscat, has proposed a 45 per cent dividend for the year 2014, 25 per cent in cash, five per cent as bonus shares and 15 per cent in the form of mandatory convertible bonds. The meeting of the Board of Directors chaired by Shaikh Khalid bin Mustahail Al Mashani, Chairman, on 28 January 2015, approved the 2014 financial results and dividend payout, subject to approval of the Central Bank of Oman (CBO) and shareholders of the bank. Shaikh Khalid bin Mustahail Al Mashani said, ”Amid the challenging economic and financial situation marked by volatile oil prices in the last quarter of 2014, the key business lines of the bank recorded healthy performance on expected lines.”

Under the proposed dividend, shareholders would receive a cash dividend of OMR 0.025 per ordinary share of OMR 0.100 each aggregating to OMR 54.57 million on Bank’s existing share capital. In addition, they would receive bonus shares in the proportion of one share for every 20 ordinary shares aggregating to 109,134,409 shares of OMR 0.100 each amounting to OMR 10.91 million. They would also receive mandatory-convertible bonds of OMR 0.015 per ordinary share of OMR 0.100 each aggregating to OMR 32.74 million (including issue expenses), which will carry a coupon rate of 3.5 per cent per annum. These bonds will mature after a period of three years from the date of issuance. On maturity, the bonds will be converted to ordinary shares of the bank by using a “conversion price” which will be calculated by applying a 20 per cent discount to the three month average share price of the bank on the Muscat Securities Market prior to the conversion. The bonds will be listed on the Muscat Securities Market. The proposed cash dividend and issuance of bonus shares and mandatory-convertible bonds are subject to formal approval of the Annual General Meeting of the shareholders and the regulatory authorities.

The bank posted a net profit of OMR 163.23 million in 2014 compared to OMR 152.19 million reported in 2013, an increase of 7.3 per cent. Basic earnings per share were OMR 0.075 in 2014 as against OMR 0.072 in 2013. The bank’s capital adequacy ratio stood at 15.92 per cent after appropriation for proposed dividend for the year 2014 as against the minimum required level of 12.625 per cent as per Basel III regulations issued by the Central Bank of Oman.

CPI Financial