8th December 2024, Kathmandu
NMB Bank has announced that it will not be distributing dividends for the fiscal year 2080/81 (2023/24), disappointing its shareholders. The decision, made at the bank’s board meeting last Friday, has left investors without the expected return on their shares.
NMB Bank’s No-Dividend Decision
No Dividends from Profit for the Year
The bank’s management decided to withhold dividends despite recording profits during the fiscal year. On Mangsir 21 (December 6, 2024), the board of directors reviewed the financial performance and concluded not to allocate any dividends. This move surprised many, as shareholders had been hoping for a share of the profits.
Approval Process for Financial Statements
The bank also took the step of submitting its financial statements to Nepal Rastra Bank (NRB) for approval.
Once the central bank approves the documents, they will be presented during the Annual General Meeting (AGM). This is a routine process, but the absence of a dividend announcement may overshadow other topics during the meeting.
Investors React to the Announcement
Shareholders had anticipated a dividend after the bank reported positive financial results for the year. Historically, NMB Bank has been known for its regular dividend distribution, making this change in policy a surprising one.
The bank did not explain withholding the dividend, leading to speculation about internal financial strategies or external regulatory concerns.
Looking Ahead to the AGM
With no dividend distribution planned, all eyes will be on the AGM. Shareholders will await any further clarifications or updates on the bank’s performance and future dividend policies.
NMB Bank’s decision to withhold the dividend has led to discussions about its financial priorities and long-term goals.
Future of NMB Bank’s Dividend Policy
NMB Bank’s decision to skip the dividend distribution could be part of efforts to maintain financial stability. The bank may be focusing on strengthening its balance sheet in light of changing economic conditions.
Shareholders and market analysts will continue to monitor the bank’s actions closely as the fiscal year progresses.
For more: NMB Bank’s No-Dividend Decision
