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Kenya

Kenyan bank gets bonus shares nod

NAIROBI, Kenya, Jul 20 – The Capital Markets Authority (CMA) has granted approval to the National Bank of Kenya (NBK) for the issue of bonus shares in the ratio of two new ordinary shares for every five shares held as at close of business on April 9, 2010.

This means that the bank has the green light to list the additional 80 million ordinary shares with a par value of Sh5.00 that will be created in the issue on the Main Investment Market Segment of the Nairobi Stock Exchange.

“In approving the bonus issue and listing of the additional shares, the Authority has considered the application by National Bank of Kenya and is satisfied that it meets the requirements of the Capital Markets Act 485(A) and Regulations issued there under,” said CMA Chief Executive Officer Stella Kilonzo.

The bank’s shareholders approved the issue earlier in the year, a move which allows the institution to retain cash in the business to finance its growth and expansion plans.

NBK has not paid out dividends for 12 years despite returning on a profit making streak in 2002, which has enabled the bank to clear its huge deficit.

However, during the 41st Annual General Meeting in June, the management assured their shareholders that after that long wait, they would start receiving dividends from next year.
 
A quasi-owned government bank, NBK is one of the institutions that have been earmarked for privatisation and the government has already picked two advisers for the transaction. The government holds a 22.5 percent stake in the bank and a further 48.06 percent through the state-owned NSSF. The remainder is with the public through the Nairobi Stock Exchange.

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