Everest Bank Limited, the most profitable commercial bank in the last fiscal year, is expected to announce its dividend within this week.
According to high-level sources at Nepal Rastra Bank (NRB), the bank’s financial report is in the final stage of approval. Once NRB clears the balance sheet, the Board of Directors of Everest Bank will decide on the dividend.
Last year, Everest Bank was the first commercial bank to declare and distribute dividends before Dashain. This year, however, Machhapuchchhre Bank became the first to announce dividends as NRB delayed approval of Everest Bank’s report.
Dividend Capacity
For FY 2081/82, Everest Bank has a dividend-paying capacity of 38%, one of the highest among commercial banks. The bank’s paid-up capital stands at Rs. 12.94 billion.
Likely Mode of Dividend
A board member hinted that the management prefers cash dividends over bonus shares this year. The reason is to avoid unnecessary growth in paid-up capital, which could create pressure on future returns.
Everest Bank has maintained a strong Return on Equity (ROE) of 16.44% in FY 2081/82, compared to around 14% the previous year. Focusing on cash dividends would help the bank sustain this performance.
CEO Mr. Sudesh Khaling declined to comment on the delay in NRB’s approval process.
