Shareholders of Kenya Commercial Bank Group have a reason to smile after the lender approved a 9.2 billion shillings as total dividend payout for the 2017 fiscal year.
The move according to financial analysts signifies a sustained return to shareholders amid a tough operating environment in the country.
During the 2017 Annual General Meeting (AGM) shareholders approved a final 2 shillings dividend per ordinary share as recommended by the Board. This brings to 3 shillings the total dividend for the year, taking into account an interim dividend of 1shillings per share paid out last October.
“We continue to provide consistent value to our shareholders through our robust business model. This was catalyzed by the robust governance structure at the Group level which helped us weather the myriad challenges and led to an improved underlying performance for the business,” said KCB Group Chairman Ngeny Biwott.
The Bank’s dividend policy, said the chairman, is to maintain a dividend payout of up to 50 percent of profit after tax. The dividend will be paid on or about June 29, 2018, to shareholders on the register as of the close of business on April 30, 2018.
The Group reported a Return on Equity— a measure of how much profit a company generates with the money shareholders have invested—of 19.5 percent in 2017, one of the highest return of the banks listed on the Nairobi Securities Exchange (NSE).
KCB maintained stable ratings, with Global Credit Ratings (GCR) affirming KCB’s long-term and short-term national scale ratings of AA (KE) and A1+ (KE) respectively.
Moody’s Investor Services expects KCB to maintain a strong performance in a difficult financial services sector while S&P rating agency affirmed the Banks’ B+/B long and short-term rating with a stable outlook, which mirrors that of the Sovereign.
In 2017, KCB Group posted a net profit of 19.7 billion shillings, indicating a flat growth having posted the same in 2016. The loan book and deposits expanded significantly by 10 percent to 423 billion shillings and 11 percent to 500 billion shillings respectively.
KCB said the Group’s future outlook remains positive based on strong capitalization and expectations of an economic rebound this year in its key markets.