National Bank of Abu Dhabi (NBAD), the UAE’s largest lender by assets has hiked its 2015 dividend after investor pressure, the bank’s chairman Nasser Ahmed Al Sowaidi said on Tuesday.
The move highlights the dilemma UAE banks face in continuing to reward shareholders at a time when the impact of lower oil prices is squeezing business and could put pressure on capital.
The UAE Central Bank has already flagged concerns about dividend payments and safeguarding bank liquidity, telling lenders they would need to get payouts approved.
NBAD’s new figure of Dh0.45 per share, announced at the bank’s annual shareholder meeting, is up from the Dh0.40 the bank proposed paying when it unveiled its annual results in January.
The move was a direct response to a request from shareholders, Mr Al Sowaidi told the meeting, without elaborating.
Hiking the dividend brings it closer to the 2014 yield, when NBAD distributed a Dh0.40 cash dividend as well as a 10 per cent stock dividend.
It also puts it in line with Abu Dhabi Commercial Bank, which is paying Dh0.45 for 2015, and ahead of Dubai-based Emirates NBD, which gave shareholders Dh0.40 a share.
NBAD chief executive Alex Thursby told reporters after the meeting there had been a “bloom” in deposits so far this year.
“There’s liquidity in the system,” Mr Thursby said. “We are in a good position.”
NBAD was hit hard in the second and third quarters of 2015 by deposit outflows as the UAE government drew upon reserves with local banks to help shore up its finances.
Mr Thursby said the bank had no plans to enter new markets in 2016, marking a “change in pace” for NBAD which has been expanding in recent years, including in Egypt, India, Hong Kong and Malaysia in a bid to capture growth.
In October 2015, it snapped up Royal Bank of Scotland’s offshore loan book in India for Dh3 billion shortly before it started operations there.
However, UAE banks including NBAD have been seeking to cut costs, including staff redundancies, to manage the expected slowdown due to lower oil prices.
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
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hall of shame
SUNDERLAND 2002-03
No one has ended a Premier League season quite like Sunderland. They lost each of their final 15 games, taking no points after January. They ended up with 19 in total, sacking managers Peter Reid and Howard Wilkinson and losing 3-1 to Charlton when they scored three own goals in eight minutes.
SUNDERLAND 2005-06
Until Derby came along, Sunderland’s total of 15 points was the Premier League’s record low. They made it until May and their final home game before winning at the Stadium of Light while they lost a joint record 29 of their 38 league games.
HUDDERSFIELD 2018-19
Joined Derby as the only team to be relegated in March. No striker scored until January, while only two players got more assists than goalkeeper Jonas Lossl. The mid-season appointment Jan Siewert was to end his time as Huddersfield manager with a 5.3 per cent win rate.
ASTON VILLA 2015-16
Perhaps the most inexplicably bad season, considering they signed Idrissa Gueye and Adama Traore and still only got 17 points. Villa won their first league game, but none of the next 19. They ended an abominable campaign by taking one point from the last 39 available.
FULHAM 2018-19
Terrible in different ways. Fulham’s total of 26 points is not among the lowest ever but they contrived to get relegated after spending over £100 million (Dh457m) in the transfer market. Much of it went on defenders but they only kept two clean sheets in their first 33 games.
LA LIGA: Sporting Gijon, 13 points in 1997-98.
BUNDESLIGA: Tasmania Berlin, 10 points in 1965-66
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