• Wednesday, February 21, 2024
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BusinessDay

Big banks dividend comparison: GTCO, Zenith, UBA & Access

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Investors in the Nigerian stock market have made bumper harvests from their holdings in listed companies, as they rake in passive income from dividend payments for the 2022 financial year.

BusinessDay’s analysis of the latest annual financial reports of United Bank for Africa (UBA), Guaranty Trust Holding Company (GTCO), Zenith Bank, and Access Holdings Plc, revealed a total sum of N236.43 billion dividend payout in 2022 (Interim dividend payout was used for Access Bank).

Furthermore, the data showed Zenith Bank and Guaranty Trust Holding Company (GTCO) recorded the most attractive dividend-paying stocks in the banking industry.

Dividend payment is one of the ways stock market investors earn passive income, while companies also use this as an incentive to encourage investors, which is paid from the profit declared in that financial year.

However, some companies do vote in favour of not paying dividends if the board believes the company needs cash, or there was a loss declared.

Profit after tax deductions reported by these banks grew slowly by 2.59 percent to an aggregate of N716.26 billion in 2022 from N698.17 billion in 2021, on the back of the effect of impairment from Ghana debts recorded on the subsidiaries of these banks.

BusinessDay’s findings also showed Zenith Bank’s shareholders unanimously approved a proposed final dividend payment of N2.90 kobo per share, amounting to a gross dividend of N91.05 billion in 2022 while the shareholders of GTCO declared a N2.80 kobo per 50 kobo ordinary share final dividend amounting to N82.41 billion.

In comparison with peers in the tier-1 category, Access Holdings paid an interim dividend in June 2022 at N0.20 kobo amounting to N7.11 billion while United Bank for Africa’s final dividend stood at N0.90 kobo per share amounting to N30.78 billion.

First Bank Holdings is yet to declare a dividend as of the time of filing this report.

Bank analysis

Zenith Bank

Zenith Bank’s total dividend amounted to N3.20 per share for the 2022 financial year period compared to N3.10 per share total dividend in the financial year which ended in 2021.

At the 32nd Annual General Meeting of Zenith Bank Plc, shareholders of the bank unanimously approved the proposed final dividend payment of NGN2.90 per share which brings the total dividend for the 2022 financial year to N3.20 per share with a total value of N100.47 billion.

Jim Ovia, founder and chairman of Zenith Bank Plc, while speaking at the Annual General Meeting expressed his gratitude to the shareholders for their unwavering loyalty, commitment, and support, which have been instrumental in the bank’s outstanding performance since its inception.

Faruk Umar, president of the Association of the Rights of Nigerian Shareholders commended the board and management of Zenith Bank for consistently delivering value to shareholders, despite the challenging economic environment.

The recent financial books of the bank have shown basic and diluted earnings per share which amounted to N2.10 per share in the first quarter of 2023 from N1.85 per share in the first quarter of 2022.

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Zenith Bank’s profit attributable to shareholders of the bank increased to N65.95 billion in the first quarter of 2023, up 13.5 percent from N58.12 billion in the first quarter of 2022.

Cash and cash equivalents at the end of the period increased by 65 percent to N2.31 trillion in the first quarter of 2023 from N1.40 trillion in the first quarter of 2022.

GTCO

GTCO’s total dividend arrived at N3.10 per share for the 2022 financial year; the bank’s total dividend for 2021 stood at N3.00.

Shareholders of Guaranty Trust Holding Company Plc endorsed the payment of a total dividend of N91.236 billion, representing N3.10 per share for the financial year ending December 31, 2022.

This endorsement was made at the holding company’s second annual general meeting held virtually.

The group proposed a final dividend of N2.80 per unit of ordinary share held by shareholders in addition to the interim dividend of 30 kobo interim dividend paid in June, bringing the total dividend for the 2022 financial year to N3.10 per unit of ordinary share.

In comparison with the 2021 financial year, the approved final dividend stood at N2.70 per ordinary share of 50 kobo to a total dividend of N88.293 billion, translating to a total dividend of N3.0 per share.

In the recent financial results, GTCO’s basic earnings per share amounted to N2.04 per share in the first quarter of 2023 from N1.51 per share in the first quarter of 2022.

The net profit used to determine diluted earnings per share amounted to N57.14 billion in the first quarter of 2023, up 35 percent from N42.32 billion in the first quarter of 2022.
GTCO’s cash and cash equivalents rose to N1.38 trillion in the first quarter of 2023, 51 percent increase from N913.65 billion in the first quarter of 2022.

Access Holding

Access Holdings, a Nigeria-based financial holding company, arrived at a total dividend of N1.50 per share for the 2022 financial year, this is coming from N1.00 per share in 2021.

Access Holdings Plc has proposed a final dividend of N46.209 billion, representing N1.30 per share to its shareholders for the year ended December 31, 2022.

However, in the audited results of the financial institution released, the board proposed the payment of N1.30 as the final dividend compared with the 70 Kobo paid in the 2021 accounting year, bringing the total cash reward for the 2022 financial year to N1.50.

In comparison, Access Holdings announced a final dividend payment of N0.70 kobo per 50 kobo ordinary share for the financial year ended December 2021.

This results in the total dividend of N1.00 kobo which is made up of the interim dividend of N0.30 per share which was paid on September 29, 2021, and a final dividend of N0.70 per ordinary share, subject to withholding tax.

Access Holdings’ recent financial result shows basic earnings per share at N206 per share in the first quarter of 2023 from N458 per share in the first quarter of 2022.

The profit attributable to equity holders of the parent entity stood at N70.63 billion in the first quarter of 2023 , up 24.1 percent from N56.92 billion in the first quarter of 2022.

Access Holdings’ cash and cash equivalent declined marginally by 5 percent to N1.17 trillion in the first quarter of 2023 from N1.23 trillion in the first quarter of 2022.

United Bank for Africa (UBA)

UBA’s total dividend amounted to N1.10 per share for the 2022 financial year compared to the N1.00 total dividend for the 2021 financial year.

In the bank’s usual tradition of rewarding shareholders, the bank proposed a final dividend of 90 kobo for every ordinary share of 50 kobo, for the financial year ended December 31, 2022.

The final dividend will bring the total dividend for the year to N1.10 per share, as the bank had paid an interim dividend of 20 kobo, based on its audited 2022 half-year results.

Tony Elumelu, UBA’s group chairman said, “We appreciate all our regulators, customers and shareholders who have partnered with us in this exciting journey of growth, and in 2023, we hope to do even better than we did in the year 2022.

“We have therefore prioritised our plans for the year which are very clear – it is all about execution, especially as this year marks a significant milestone for the group,” Elumelu said.

In comparison with the 2021 financial year dividend, shareholders of United Bank for Africa in a notice filed with the Nigerian Exchange Limited said it would pay 80 kobo as a final dividend for the financial year which is higher than the 35 kobo paid in the preceding year.

In addition to the 20 kobo interim dividend earlier paid, the total cash reward would be N1 per share for the 2021 financial year.

The recent financial results of the bank show basic and diluted earnings per share which stood at N1.47 per share for the first quarter of 2023, 29 percent increase from N1.14 per share in the first quarter of 2022.

Total comprehensive income attributable to owners of the parent company stood at N47.52 billion in the first quarter of 2023, a 125 percent increase from N21.14 billion in the first quarter of 2022.

UBA’s cash and cash equivalents increased to N1.14 trillion in the first quarter of 2023, 59.7 percent increase from N713.94 billion in the first quarter of 2022.