BoV to pay shareholders €9m in gross dividends

Bank of Valletta's recommended final gross dividend to shareholders is to be €0.0675 per share, chairman Roderick Chalmers told the annual general meeting on Wednesday. This represents a gross payment of €9 million as recommended by the directors.

Taken together with the gross interim dividend of €0.1350 per share paid on May 28, this makes for a total gross dividend of €0.2025 per share for this financial year. This dividend would be covered 1.5 times by the profits for the year.

The board also recommended that, effective January 15, an increase in the nominal and paid-up value of the ordinary shares in issue from €0.75 to €1 per share (the increase to be funded by a capitalisation of reserves), amounting to €33.33 million. There will also be a bonus issue to shareholders of one share for every five held.

Mr Chalmers explained that the two moves will further strengthen the balance sheet through the increase of the permanent paid up capital of the bank to €160 million, and will also enhance the affordability and liquidity of the bank's shares.

BoV reported a profit of €40.6 million for the financial year ended September 31.

Chief executive officer Tonio Depasquale said this financial year saw the largest ever deposit base for the bank, and also a record size and health of the loan book.

Strong solvency with an 11.5 per cent capital ratio and a prudent loan to deposit ratio of below 70 per cent helped keep the bank in good shape this year. The CEO also noted that the €41 million of fair value markdowns are unrealised in nature, and that it was expected that much of the markdown would be clawed back over time.

The bank's assets increased by €544 million, while the deposit base grew by €322 million, bringing customer deposits up to a record €4.6 billion. This was coupled by a record growth of €418 million to a total loan book of €3 billion. The quality of the loan book also improved, reducing the proportion of non-performing loans to just four per cent.

A gross final dividend of €0.0675 per share, which represents a gross payment of €9 million as recommended by the directors, was approved for payment on December 18.