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BSEC refuses AB Bank's rights offer again

| Updated: November 02, 2021 10:10:20


BSEC refuses AB Bank's rights offer again

The Bangladesh Securities and Exchange Commission (BSEC) has refused approval for AB Bank’s right share offer again.

“The stock market regulator has expressed its inability to approve the rights issue of AB Bank, considering dividend payment history and present financial position,” according to a web posting on the Dhaka Stock Exchange (DSE) on Sunday.

Earlier, the bank applied for issuance of rights shares at a ratio of 1R:6 (one right share for existing six shares) at an issue price of Tk 10 each after effecting stock dividend for the year ended on December 31, 2020.

AB Bank disbursed 5.0 per cent stock dividends for the two consecutive years – 2020 and 2019. However, the bank declared ‘no’ dividends in 2018 and 2017.

The bank’s consolidated earnings per share (EPS) stood at Tk 0.44 for January-September 2021 as against Tk 0.28 for January-September 2020.

Last year in June, the BSEC also refused approval for AB Bank’s right share offer applied in 2017. The bank proposed rights issue 3:2R (2 rights shares 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.

Each share of the bank, which was listed on the DSE in 1983, closed at Tk 14.70 on Sunday, losing 2.65 per cent. Its shares traded between Tk 8.70 and Tk 17.40 in the last year.

The company’s paid-up capital is Tk 8.35 billion and authorised capital is Tk 15 billion, while the total number of securities is 835.83 million.

The sponsor-directors own 31.67 per cent stake in the bank, while the government owns 0.57 per cent, institutional investors own 24.99 per cent, foreign investors 0.88 per cent and the general public 41.89 per cent as of September 30, 2021, the DSE data showed.

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