The Capital Markets Authority has approved a bonus issue for the National Bank of Kenya investors who have gone for more than ten years without dividend.
Investors will get two shares for every five held resulting in the introduction of 80 million additional shares that will increase the bank’s listed stocks to 360 million.
The bank posted Sh1.462 in net earnings for the year 2009, and Sh330 million for the first quarter of 2010 but the management had sought the approval of shareholders to retain the earnings earlier in the year.
NBK has lagged behind its peers andd it is planning to open up 80 branches in a bid to compete with the other banks who are many steps ahead of them.
The bank has been on a steady recovery path that saw it return to profitability seven years ago, but accumulated losses prevented the bank from paying dividend in the past 12 years.
With the retained earnings, the bank can now embark on an expansion strategy.
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