Stanbic Bank Uganda (SBU) has raised its dividend pay-out by 14 per cent despite the lender’s net earnings dropping by a fifth due to its shrinking loan book.
The bank will pay a of final dividend of USh0.977 ($0.00039) per share on top of special offer of USh0.586 ($0.00023), bringing the total pay-out to Ush1.563 ($0.00062) per share compared to USh1.37 ($0.00054) in 2012.
SBU’s net profit stood at USh101.8 billion ($40.56 million) in the period to December 2013, a 22 per cent drop in earnings compared to the USh130.7 billion ($52.07 million) posted a year earlier.
The Uganda Securities Exchange-listed lender’s net interest income was down 16.5 per cent to USh247.7 billion ($98.69 million) on the back of lower uptake of loans by corporates, SMEs and individuals.
Uganda’s largest bank by assets saw its loan book fall by a percentage point to USh1.415 trillion ($563.75 million) from USh1.460 trillion ($581.67 million) in 2012 blamed on a high interest regime in the landlocked economy.
Its loan loss provisions dropped 61 per cent to USh44.9 billion ($17.89 million).
Customer deposits dwindled to USh1.7 trillion ($677.29 million) as at December 2013, compared to USh2.09 trillion ($832.67 million) the previous year.
The bank is 80 per cent owned by South Africa’s Standard Bank with the remaining shares owned by the public.
SBU listed on the Uganda bourse through an initial public offering in 2006 priced at Ush70 ($0.029) a piece in which Kenyans were considered equally as locals in buying the shares.
Central Bank of Kenya Pension Fund is among SBU’s top owners with a 0.48 per cent stake.
The bank in 2012 issued an additional 40 billion shares in the ratio of four shares for every share held having offered a bonus issue in the ratio of 1:1 a year earlier.
This was part of SBU to shore up capital to USh51 billion ($20.32 million) surpassing the Bank of Uganda’s minimum requirement of USh25 billion ($9.96 million).
SBU’s dividend yield stands at 5.21 per cent based on the stock’s USh30 ($0.012) closing price at the USE Wednesday.