The Morocco-based banking group Banque Centrale Populaire (Banque Populaire) is looking to raise as much as MDH809.02 million ($90.70 million) in new shares by converting 50 percent of its dividends for the 2020 financial year.
The decision was approved following the board’s presentation to the General Assembly at its Extraordinary General Meeting on June 24.
The group is a leading financial services company in Morocco that maintains overseas offices in Germany, England, Canada, Spain and other European countries.
Mohamed Karim Mounir was appointed CEO on Nov. 1, 2018.
Banque Populaire operates mainly as a credit institution in the form of a public limited company with a board of directors and is considered one of the largest banks in the country.
A prospectus issued by the group revealed that if all the group’s shareholders exercise the partial conversion option, up to 3,076,116 new shares at a price of MDH263 ($29.50) per share will be issued, limited to 50 percent of the dividends declared for the 2020 fiscal year.
This suggests that the amount of capital increased through the optional conversion of partial dividends could be between MDH0 and MDH809.02 million ($90.70 million), excluding withholding tax in the application of the provisions.
The new shares will be listed on Sept. 28 and admitted in line with the old shares listed on the Casablanca Stock Exchange.
Banque Populaire’s plan to raise new shares through the optional conversion of partial dividends follows the bank’s decision to pay shareholders a dividend of MDH8.0 ($0.90) per share on all its issued ordinary shares.
This amounts to a gross dividend distribution of MDH1.618 billion ($181.41 million) from the bank’s profit in 2020.
The dividend demonstrates the resilience of the Morocco-based banking group despite the impact of the COVID-19 pandemic on the group’s operations and earnings in 2020.
Information contained in the bank’s financial report revealed that its consolidated net income in 2020 fell by 67 percent to MDH1.3 billion ($145.75 million).
As of press time 6:00 AM (UTC) Aug. 3, shares in the banking group were worth MDH271.50 ($30.44), nearly nine-percent higher than its opening price of MDH249.70 ($28.00) for the year.
Its market capitalization on the Casablanca Stock Exchange is MDH54.91 billion ($6.16 billion).