Wema Bank to Pay 30% of FY19 Profit as Dividend

By Dipo Olowookere

The board of Wema Bank Plc has proposed the payment of 4 kobo for every stock of the company held by shareholders.

On Wednesday, the lender announced its earnings for the 2019 fiscal year and from the analysis, the financial institution maintained its growth trajectory as gross earnings improved by 32.7 percent to N94.9 billion from N71.5 billion in 2018.

According to the bank, interest income stood at N70.7 billion in FY 2019 as against N57.6 billion in FY 2018, with the interest expense at N44.7 billion in contrast to N30.6 billion and the net interest income at N26.0 billion versus N27.0 billion in the corresponding period of 2018.

The net fee and commission income grew to N8.0 billion from N6.5 billion, while the trading income broadly rose to N14.8 billion from N5.5 billion, with other income reducing to N1.2 billion from N1.8 billion.

Wema Bank said its operating income increased to N44.1 billion from N37.4billion, while its personnel expenses jumped to N14.9 billion from N12.3 billion, with the other operating expenses rising to N19.1 billion from N17.6 billion.

In the results analysed by Business Post, the financial institution’s profit before tax increased to N6.8 billion from N4.8 billion, while the profit after tax skyrocketed to N5.2 billion from N3.3 billion, with the earnings per share (EPS) to 13 kobo from 8 kobo.

Business Post observed that from the N5.2 billion net profit made by Wema Bank, it paid out about 30 percent as dividend, N1.543 billion as against N1.157 billion (3 kobo) paid in 2018.

According to the lender, this dividend payment was recommended on the back of improved performance and the bank meeting all regulatory requirements for such payment.

“The payment will be made from the audited earnings of 2019 and not from the accumulated reserves in line with the regulatory policy.

“The payment of dividend is in line with the bank’s dividend policy and will go a long way in providing support to our shareholders,” Wema Bank said.

In the period under review, Wema Bank’s deposits from customers increased to N577.3 billion from N369.2 billion, while loans to customers jumped to N289.2 billion from N252.2 billion, with the retained earnings reducing to N3.3 billion from N6.0 billion.