United Bank for Africa (UBA) Plc shocked the market with the N2.00 interim dividend proposed by the board of the company for the period ended June 30, 2024.
This was because the amount offered to shareholders by the lender was higher than its peers in the tier-1 category, especially as the likes of Zenith Bank and GTCO paid N1 for the same period to their shareholders.
Normally, Zenith Bank and GTCO pay their shareholders higher rewards than the trio of UBA, FBN Holdings and Access Holdings in the tier-1 category, collectively known as ZAGUF.
On Monday, when UBA released its half-year earnings, it offered to reward its investors with an interim dividend of N2 for every ordinary share of 50 Kobo each subject to applicable withholding tax. This amount was higher than the 50 Kobo paid in the same period of 2023 by 300 per cent.
In a notice to the Nigerian Exchange (NGX) Limited, the lender said this money would be “paid to shareholders whose names appear in the register of members as at the close of business on Monday, October 14, 2024.”
With the register of members expected to be closed on Tuesday, October 15, 2024, UBA said shareholders should anticipate bank alerts of the payment on Tuesday, October 22, 2024, particularly if they “have completed the e-dividend registration and mandated the registrar to pay their dividends directly into their bank accounts.”
This announcement triggered buying interest in UBA stocks at the equity market on Monday as investors jostled to have a bite of the pie.
This renewed demand for UBA shares pushed its value higher by 9.90 per cent or N2.55 on Monday to N28.30 per unit when trading activities ended for the session.
A cursory look at the financial performance of UBA in the first six months of this year showed that UBA grew its gross earnings by 40 per cent to N1.37 trillion from N981.77 billion between January 2023 and June 2023.
It was observed that the bank’s interest income went up by 134.3 per cent to N1.003 trillion from N428.2 billion, with the pre-tax profit slightly down by 0.25 per cent to N402 billion from N403 billion and profit after tax down by 16.40 per cent to N316 billion from N378 billion.
-By Dipo Olowookere