BCEL dividend payment to stimulate stock investment
BCEL dividend payment to stimulate stock investment
BCEL Bank, the largest commercial bank in Laos will pay a shareholder dividend for the first six months of this year early next month, which will help Lao investors realise the benefits of the stock market.
According to an announcement from BCEL Bank, one of the two public companies listed on the Lao Securities Exchange, shareholders of the public company will receive a dividend for the first six months of 2012 of 436 kip per share.
The bank has selected August 31 as the closing date of the shareholders' register book, which they will use to determine shareholders who are eligible for share dividends for the first half of the 2012. This means that any individuals and legal entities still holding BCEL bank shares on that date are entitled to receive a dividend.
The Lao Securities Exchange expects to transfer the dividend payments to accounts of the bank's shareholders within seven days after the closures of the shareholder register book.
BCEL bank decided to pay the before tax dividend after cutting the half yearly profit for regulatory reserves and other reserves for business operation and expansion.
The main shareholder of BCEL bank is the Lao government, which holds 70 percent of the shares, while Cofibred holds 10 percent, bank staff hold 5 percent and the rest belongs to stock investors.
According to the bank, it expecte d to make a net profit of about US$23 million this year. In 2011 the bank, which holds about 40 percent of the financial market in Laos, made a net profit of about US$18 mill ion.
In the first quarter of this year, the bank's loan portfolio continued accelerating by 13 percent compared to the previous quarter's 5,800 billion kip, which stock analysts expect will enable the company to forward loan growth of around 40 percent year-on-year.
Observers say that the decision by BCEL bank to pay the twice a year dividend was one way to make the public see the benefits of investment in the stock market. Most Lao people do not have experience in stock market investment, and are therefore reluctant to purchase shares as a result.
If Lao people see the benefits and decide to invest in the stock market rather than depositing money in commercial banks accounts, it will make it easier for other companies to mobilise investment funds through public share offerings.
A number of companies such as Enterprise of Lao Telecom planned to list on the stock market last year but decided to postpone due to unfavourable domestic and world economic conditions.
Other companies,which plan to list on the LSX include the Indochina Group and Lao Cement Industrial Company Ltd., but it is still unclear whether these companies will be able to list on the market this year.
vientiane times
