By Bamidele Ogunwusi, Lagos
Management of FBN Holdings has said the reason why the company proposed low dividend in the 2014 financial year was to enable it retain capital to beef up its capital requirement following the Basel2 capital requirement.
Group Managing Director of the Holdings, Bello Machido, who disclosed this at the facts behind the figures presentation on the floor of the Nigerian Stock Exchange on Wednesday, said the Group resorted to the option in order not to file for recapitalization like many other banks to meet up with the Basel 2 requirement.
He said there is no immediate plan by the company to raise tier 1 capital within the next 12 months given the low market liquidity, depressed valuation level and significant dilution risk to existing shareholders.
He noted that capital position of the Group is being enhanced through increase profit retention, interim recapitalization of profit, more efficient balance
He said in order to sustain efficiency of the Group; it is planning to rationalize unprofitable and minimum expansion.
Source : Independent