Despite the challenges in the domestic and global economy, eight listed financial institutions on the Nigerian Exchange Limited (NGX) declared a total final dividend of N286.892 billion in 2022.
The dividend payout, according to LEADERSHIP findings, is on the back of N845.739 billion profit after tax achieved by the eight financial institutions for the year ended December 31, 2022.
The year 2022 witnessed upheaval globally and it came with significant headwinds across all emerging markets, among other markets.
For many investors, dividend-paying stocks have come to make a lot of sense in Nigeria given the almost cultural belief that making returns on investment is the essence of engaging in any investment or business plan. The banks listed on the Nigerian Exchange are known for their high dividend payout.
Dividend has remained one of the key factors that traditionally drive market activities and aid investment decisions towards stocks across the globe, and the Nigerian bourse is not an exception. It can be paid twice in a year depending on the company dividend policy.
Zenith Bank proposed a final dividend of N91.048 billion, representing N2.90 per share, while Guaranty Trust Holding Company declared N82.407 billion, that is N2.80 per share.
Access Holdings came up with N46.209 billion final dividend, representing N1.30 per cent, United Bank for Africa (UBA) declared N30.779 billion final dividend or 90 kobo per share, Stanbic IBTC Holdings to give shareholders N25.914 billion or N2.00 per share as dividend, while FCMB Group proposed N4.951 billion or 25 kobo per share as dividend in 2022.
Wema Bank’s shareholders are to get N3.857 billion or 30 kobo per share dividend, while Jaiz Bank declared a dividend of N1.727 billion or 0.05 kobo for the year ended December 31, 2022.
Capital market analysts lauded 2022 corporate earnings and dividend payout of banks, stating that financial institutions in Nigeria are resilient to overcoming domestic and foreign challenges and declared dividends from their earnings.
The chief research officer, InvestData Consulting Limited, Mr. Omordion Ambrose said, the 2022 performance of these companies are impressive and their dividend returns are more attractive when compared to yields on money market instruments.
He said: “from the results we have seen so far, Zenith Bank proposed N2.90 final dividend and GTCO declared N2.80 final dividend payout on the NGX. Some of these companies over the years have been consistent in dividend payout to shareholders.”
The managing director of HighCap Securities Limited, Mr. David Adonri said, an investor who wants to receive a steady income should consider investing in established companies which are mainly concerned with keeping their shareholders happy with dividend payments either interim or final dividend, saying, investors also regard dividend payment as a sign of a company’s strength.
The founder of Tradelines DotBiz Investment Limited, Mr Tunde Jeariogbe said, the tier-one banks, over the years, have been consistently paying dividends and 2022 dividend payout from them are impressive.
The managing director/CEO APT Securities and Funds Limited, Mr. Garba Kurfi commended listed financial institutions for releasing impressive results and accounts for 2022, expressing concerns that the declared dividend by these companies did not reflect in the trajectory of the stock market in Q1, 2023.
According to him, these companies have declared impressive dividend payout to investors but I do not know why the NGX Bank index did not respond to dividend payout in the financial sector.
“Investors on the Exchange were concerned over political unrest, among other factors, and opted to sell some of these banking stocks. We hope these banking stocks will bounce back in the second quarter of 2023 once unaudited first quarter results and accounts are released to the investing public,” he stressed.
Speaking on GTCO audited results for 2022, the group chief executive officer of GTCO, Mr. Segun Agbaje, said: “our ability to successfully navigate the peculiar challenges in the different markets where we operate underscores our strong business fundamentals and unwavering commitment to sound business strategies.
“Despite the varying challenges and headwinds that weighed on growth in 2022, we were determined to deliver a decent performance and scale effectively to strengthen our competitive edge and drive long-term growth.”
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