By: Mahmoud Gamal
Dubai – Decypha: The governments of the emirates of Abu Dhabi and Dubai have received a combined AED 5.72 billion ($1.55 billion) in dividends from their investments in UAE-listed banks, statistics by Decypha showes.
In comparison to other bourses, the dividends recently announced by UAE banks are of higher standing, especially amid the increasing difficulties the sector faces both locally and globally, capital market analyst Ahmed Ismail told Decypha.
In total, the dividends distributed by banks listed on the Abu Dhabi Securities Exchange (ADX) for 2016 amounted to AED 10.4 billion, of which AED 3.67 billion were distributed to banks.
The ordinary general meeting (OGM) of the National Bank of Abu Dhabi (NBAD) approved, last month, a cash dividend of 45% of capital or around AED 2.34 billion. The Abu Dhabi Investment Council (ADIC), the emirate’s investment arm, owns 69.17% of the bank, bringing its dividends share to around AED 1.622 billion.
Similarly, Abu Dhabi Commercial Bank’s (ADCB) OGM nodded to a 40% cash dividend or around AED 2.23 billion, bringing ADIC’s share of the dividends to AED 1.39 billion, from its 62.52% stake in the bank.
First Gulf Bank’s (FGB) shareholders approved a 45% cash dividend or AED 2.34 billion; the government’s Mubadala Development’s 7.115% in the bank will result in roughly AED 166 million in dividends.
The high cash dividends given out by some banks have attracted long-term investors, the analyst said.
“Banks’ strength tend to give it high liquidity, which often results in the large dividends we see,” Ismail added.
Of Union National Bank’s (UNB) 20% of capital cash dividend, totaling AED 550 million, ADIC’s 50% stake will likely result in AED 275.04 million.
Abu Dhabi Islamic Bank’s (ADIB) announcement of 24.52% dividends of 2016, amounting to AED 777 million, will likely bring ADIC’s 7.61% stake AED 59.17 million in distributions.
Meanwhile, the Dubai government’s share of the emirate banks’ dividends for 2016 amounts to around AED 2.04 billion, the statistics showed.
Dubai-based banks distributed a combined AED 5.7 billion in dividends for 2016.
“Dubai’s banks distributed cash dividends last year to boost market liquidity,” according to Ismail.
Emirates NBD’s shareholders approved a 40% dividend, or AED 2.22 billion, of which the Investment Corporation of Dubai (ICD) boasts a 55.76% stake, bringing its dividends to around AED 1.24 billion.
Dubai Islamic Bank (DIB) nodded to a 45% dividend, totalling AED 2.22 billion. The government of Dubai holds 28.33% in the bank, bringing its dividends to AED 630 million for 2016.
The Commercial Bank of Dubai also announced a 20% cash dividend, or AED 561 million, in which the government has a 20% shareholding and could make around AED 112 million in dividends.
While bank’s dividends have shown strong figures for 2016, it is expected that bank’s will yield higher figures in 2017, as the pace of construction and other works pick up ahead of the Dubai Expo 2020, according to GCC market analyst, Amer Al Mohannadi.
Translated by: Nada Adel Sobhi
