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Listed banks got a tepid response from bearish investors despite offering relatively good dividends for 2021 marked by the pandemic.
Out of 33 banks listed on the stock exchanges, so far 12 banks declared dividends for the year. Of those, five banks have paid dividends in the last year higher than the previous year and four banks gave the same dividends declared in the previous year. However, only two banks declared dividends lower than the previous year and a bank paid no dividend, according to the data from the Dhaka Stock Exchange.
In this reality, banks failed to attract lower-than-expected investors, weighing on their share prices. Yet they offered relatively higher dividends than some other listed companies.
“A group of investors was shunning banking stocks in part because they worried that lower investment during the pandemic might lead to an economic slowdown,” said a leading analyst.
Of the banks, Premier Bank paid the highest 22.5 per cent dividend in 2021, up from 20 per cent in 2020. Its share price gained more than 16 percent in one year to April 6, 2022.
During the period, Prime Bank offered 17.5 per cent dividend, up from 15 per cent. Its share price shot up 21 per cent in one year to April 6 this year.
Likewise, Mercantile Bank gave 17.5 per cent, up from 15 per cent. Its share price increased 60 per cent during the period.
Shahjalal Islami Bank declared a 15 per cent dividend in 2021, up from 12 per cent in 2020. Its share price rose 20.7 per cent
The banks that offered the same dividends in 2020 and 2021 are BRAC Bank, IFIC Bank, Jamuna Bank and UCB. Their share prices increased ranging from 12 per cent to more than 49 per cent.
The banks—Dutch Bangla Bank and Eastern Bank Limited—declared dividends in 2021 lower than 2020. Their share prices rallied ranging from 38 per cent to 65 per cent.
“Our activities almost remained inactive in 2020 and a big part of 2021,” Prime Bank Company Secretary Tanvir A Siddiqui told the Business Post.
During the pandemic period, banks’
