The board of directors of AB Bank has recommended for issuance of rights share for strengthening the equity capital base of the Bank at a sustainable level.
Rights shares are issued to the company’s existing shareholders that entitled them to buy additional shares directly from the company in proportion to their existing holdings within a fixed time period.
The board has recommended at a ratio of 1R:6 (one rights share for existing six shares to be held) at an issue price of Tk 10 each after effecting stock dividend for the year ended on December 31, 2020, the bank said in a filing with Dhaka Stock Exchange (DSE) on Wednesday.
The rights share issuance is subject to the approval of the shareholders, Bangladesh Securities and Exchange Commission (BSEC), and other regulatory authorities like Bangladesh Bank.
The board of directors of the bank has recommended 5.0 per cent stock dividend for the year ended on December 31, 2020.
The annual general meeting (AGM) will be held on June 10 at 4:00 pm through the digital platform. The record date is set on May 19.
Another record date for entitlement of the proposed rights shares will be notified later after obtaining approval from BSEC, said the bank.
The bank has also reported consolidated earnings per share (EPS) of Tk 0.50, consolidated net asset value (NAV) per share of Tk 32.26, and consolidated net operating cash flow per share (NOCFPS) of Tk negative 4.61 for the year ended on December 31, 2020, as against Tk 0.15, Tk 31.69 and Tk 35.99 respectively for the same period of the previous year.
The bank also informed that bonus shares have been recommended to strengthen the capital base of the company to support business growth and compliance of Bangladesh Bank on dividend policy for banks for the year 2020.
In 2019, the bank also disbursed a 5.0 per cent stock dividend.
Each share of the bank, which was listed on the DSE in 1983, closed at Tk 9.60 on Tuesday. Its shares traded between Tk 6.70 and Tk 13.80 in the last one year.
Its paid-up capital is Tk 7.96 billion and authorised capital is Tk 15 billion, while the total number of securities is 796.03 million.
The sponsor-directors own 31.67 per cent stake in the bank while the government owns 0.57 per cent, institutional investors own 25.44 per cent, foreign investors 0.89 per cent and the general public 41.43 per cent as of March 31, 2021, the DSE data shows.
In 2017, the bank also proposed rights issue 3:2R (2 rights share against existing 3 shares) with a face value of Tk 10 each. But the BSEC refused approval as the bank did not submit any updated documents about the right share issue.