Slim chance of any dividend from Asian Life for the last fiscal year

ShareSansar, May 19:

Asian Life Insurance Company Limited might not be able to distribute bonus shares to the shareholders from net profit it posted in the last fiscal year 2069/70.

Though the company had posted a net profit of Rs 2.33 crore in the last fiscal year, the Insurance Board might ask it to provision a chunk of that profit thereby barring it from pledging dividend or bonus share, a highly placed source at the company told ShareSansar today.

There is rumor in the market that the life insurer is planning to pledge 20 percent bonus share for the last fiscal year.

Asian Life officials have brushed aside this rumor as baseless and only said that they cannot say anything about the dividend or even the AGM at this point as the regulator has not approved their final balance sheet yet.

“Insofar as the indication we are getting is that we might be able to pledge any dividend for the last fiscal year, and that as the current fiscal year itself is about to end, it may now be more realistic to think about dividend for the current fiscal year,” the source said.

Asian Life had posted a net profit of Rs 2.33 crore in the last fiscal year – down from Rs 3.56 crore it registered in the previous fiscal year.

It may be noted that though Asian Life has been posting profit since the fourth quarter of the fiscal year 2068/69, it was able to pledge only 8.29 percent bonus share for the fiscal year 2068/69.

Back in March 2012, the Insurance Board had lifted all sorts of ban on the insurer, including the ban on bank accounts of the company in different BFIs apart from ban on stock exchange transactions.

The regulator had stated that the ban was lifted after the company obeyed the directives given by the Board, including a directive to withdrawn all dividend distributed to the shareholders.

The regulator had also fined Rs 10,000 to the then Managing Director of Asian Life, Ramesh Kumar Bhattarai for carrying out works against the interests of the insurers and insured by distributing dividend overriding the Insurance Act.