MUSCAT: Bank Muscat’s board of directors has proposed a 45 per cent dividend for 2014, including 25 per cent cash, five per cent bonus shares and 15 per cent mandatory convertible bonds.

A meeting of the board, chaired by Sheikh Khalid bin Mustahail al Mashani, chairman of Bank Muscat, cleared the 2014 financial results and dividend payout, which are now subject to approval of CBO and shareholders of the bank.

In a filing to MSM on Thursday, Mashani said, “Amid the challenging economic and financial situation marked by volatile oil prices in the last quarter of 2014, the key business lines of the bank recorded healthy performance on expected lines.”

Shareholders would receive a cash dividend of 25bz per ordinary share of 100bz each aggregating to RO54.57mn on bank’s existing share capital. In addition, they would receive bonus shares in the proportion of one share for every 20 ordinary shares aggregating to 109,134,409 shares of 100bz each amounting to RO10.91mn.

Shareholders would also receive mandatory-convertible bonds of 15bz per share of 100bz each aggregating to RO32.74mn, which will carry a coupon rate of 3.5 per cent per annum.

These mandatory-convertible bonds will mature after a period of three years from the date of issuance. On maturity, the bonds will be converted to ordinary shares of the bank by using a ‘conversion price’ which will be calculated by applying 20 per cent discount to three month average share price of the bank on the MSM prior to the conversion. The bonds will be listed on MSM.

The proposed cash dividend and bonus shares and mandatory-convertible bonds are subject to formal approval of the annual general meeting (AGM) of shareholders and regulatory authorities, Bank Muscat said in its filing.

The bank posted a net profit of RO163.23mn for full-year 2014, compared with RO152.19mn reported in 2013, registering an increase of 7.3 per cent. Basic earnings per share came in at 75bz in 2014 as against 72bz in 2013.

The bank’s capital adequacy ratio stood at 15.92 per cent after appropriation for proposed dividend in 2014 as against the minimum required level of 12.62 per cent as per Basel III regulations issued by CBO.

SOURCE: Muscat Daily