Citizens Bank International Limited (CZBIL) had proposed 24.49 percent bonus share to its shareholders. Shortly after the dividend announcement by the bank, there arouse dispute among shareholders whether the shareholders who had applied for the right share will get bonus share or not.
Despite the announcement of 24.49% bonus share, the company can provide 16 percent bonus to every shareholder if the bank is to provide bonus to those shareholders who had applied for 55 percent right share of the bank.
Earlier the company had issued 55% right share from Ashad 5, 2073 to Shrawan 9, 2073 to its shareholders.
The 214th BOD meeting of company held on Bhadra 13, 2073 had proposed 25.78 percent (24.49% bonus and 1.29% cash dividend for tax purpose) to their shareholders from the net profit it earned in the last fiscal year 2072/2073.
The bank’s BOD declared its decision stating that bonus share of the company will be distributed on the basis of the paid up capital prior to right share issuance.
As per the press release published by the bank on Bhadra 13, 2073, it’s paid up capital before 55% right share stood at Rs 3.06 arba. After calculating right share the paid up capital will reach to Rs 4.75 arba. The bank had announced to distribute 24.49% bonus share before adjusting 55% issued right shares. The total paid up capital of the bank after right and bonus will reach to Rs 5.50 arba.
| Particular |
"000" |
| Paid up Capital |
3,065,234.00 |
| After Right Share Paid up Capital |
4,751,112.70 |
| Bonus Amount |
750,675.81 |
| Bonus % |
15.80% |
| Tax Purpose |
39,509.25 |
| Tax % |
0.83% |
| Total Bonus |
16.63% |
Securities Board of Nepal has reviewed on the issue. The Board has denied the announcement of the bonus share by the company which has opposed the trend of holding shares before the book closure of respective company’s Annual General Meeting (AGM).
As per Securities Issued Guideline 2065, none of the listed companies can conduct its AGM without including new shareholders.
As per an official of the Board, ‘Only the shareholders having shares before the book closure are likely to get the dividend of the respective company.’
As per the official of Citizens Bank, “There has been no change in the bonus amount however, the shareholdes will get approx. 16% bonus regardless of the prior bonus share news by the company.’
However the bank has come up with the decision to provide bonus share on the base of the paid up capital before the issuance of 55% right share. If companies themselves decide whether to provide dividend to its shareholders or not, then there is no use of fixing book closure date.- said officials at the Board.
