The group says in a letter signed by Chief Executive James Mwangi that “the Board has passed a resolution withdrawing the proposed dividend recommendation and instead will be recommending to the shareholders that no dividend is paid for the financial year ended December 31, 2019.”
Equity bank says it will not pay dividends
Group, which operates Equity bank across the East African region, has cancelled the payment of dividends to its owners from the earnings of last year.
says in a letter signed by Chief Executive James Mwangi that “the Board has
passed a resolution withdrawing the proposed dividend recommendation and
instead will be recommending to the shareholders that no dividend is paid for
the financial year ended December 31, 2019.”
that after “careful consideration, the Board has resolved not to present the proposed
dividend because the Board wishes to exercise financial prudence so as to
conserve cash to enable the Company to respond appropriately to the unfolding
This is the first time Kenya’s second-largest bank by assets has not paid dividends
since listing on the Nairobi Securities Exchange (NSE) in August 2006. Equity is
listed on the Nairobi Securities Exchange, cross-listed on the Uganda Stock
Exchange and Rwanda Securities Exchange.
Uganda National Social Security Fund
is one of the investors in Equity group. In 2015, the fund bought more stake at
Equity Bank from London-based Helios EB Investors, becoming the single largest
shareholder of the Kenyan lender.
announced USD 211 million (798 billion Uganda shillings) in net profit in March and Mwangi said
then that the performance points to success in the
diversification of income streams as well as growing contribution of business
Bank of Uganda and the Central Bank of Kenya had asked banks in the region not
to pay dividends but retain the money to cover for loses as businesses and
individuals default on their loans due to coronavirus.
advised “shareholders of the company and other investors are advised to
exercise caution when dealing in the company’s ordinary shares on the Nairobi
Securities Exchange, the Uganda Securities Exchange and Rwanda.”
is one of the most profitable financial institutions in East Africa.