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Bank Muscat shareholders approve RO 500 million sukuk 45 percent dividend

MUSCAT, 21 March 2015 - Bank Muscat shareholders on Wednesday (18 March 2015) granted approval for the setting up of RO 500 million Meethaq Sukuk Programme and payout of 45 per cent dividend for 2014.

The issuance of sukuks will be in various tranches, either in Omani Riyal or US dollar, in the domestic and international markets through public subscription or private placement within 5 years from the approval by shareholders.

The payout of 45 per cent dividend also received the endorsement of shareholders. For the year 2014, the bank will give 25 per cent dividend in cash, 15 per cent in the form of mandatory convertible bonds and 5 per cent as bonus shares.

Shaikh Khalid bin Mustahail Al Mashani, Chairman, presided at the EGM and AGM meetings at the bank's head office. Shaikh Khalid said: “Amid the challenging economic and financial situation marked by volatile oil prices in the last quarter of 2014, the key business lines of the bank recorded healthy performance on expected lines."

Bank Muscat shareholders will receive cash dividend of RO 0.025 per ordinary share of RO 0.100 each aggregating to RO 54.57 million on the bank's existing share capital. In addition, they would receive bonus shares in the proportion of one share for every 20 ordinary shares aggregating to 109,134,409 shares of RO 0.100 each amounting to RO 10.91 million. They would also receive mandatory-convertible bonds of RO 0.015 per ordinary share of RO 0.100 each aggregating to RO 32.74 million (including issue expenses), which will carry a coupon rate of 3.5 per cent per annum, payable every six months.

The bonds will mature after a period of 3 years from the date of issuance. On maturity, the bonds will be converted to ordinary shares of the bank by using a “conversion price" which will be calculated by applying 20 per cent discount to 3 month average share price of the bank on the Muscat Securities Market prior to the conversion. The bonds will be listed on the Muscat Securities Market.

Bank Muscat posted a net profit of RO 163.23 million in 2014 compared to RO 152.19 million in 2013, an increase of 7.3 per cent. The basic earnings per share were RO 0.075 in 2014 as against RO 0.072 in 2013. The banks' capital adequacy ratio stood at 15.92 per cent after appropriation for proposed dividend for the year 2014 as against the minimum required level of 12.625 per cent as per Basel III regulations issued by the Central Bank of Oman.