Bank Muscat gets nod for OMR500 million sukuk, 45 per cent dividend

Muscat: Bank Muscat shareholders on Wednesday approved a OMR500-million Meethaq sukuk programme and payout of 45 per cent dividend for 2014.

The issuance of sukuk will be in various tranches, either in Omani rials or United States dollar, in the domestic and international markets through public subscription or private placement within 5 years from the approval by shareholders.

The payout of 45 per cent dividend also received the endorsement of shareholders. For the year 2014, the bank will pay 25 per cent cash dividend, 15 per cent in the form of mandatory convertible bonds and 5 per cent as bonus shares. 

"Amid the challenging economic and financial situation marked by volatile oil prices in the last quarter of 2014, the key business lines of the bank recorded healthy performance on expected lines," said Shaikh Khalid bin Mustahail Al Mashani, chairman of the bank.

Bank Muscat shareholders will receive cash dividend of OMR0.025 per ordinary share of OMR0.100 each aggregating to OMR54.57 million on the bank's existing share capital. In addition, they will receive bonus shares in the proportion of one share for every 20 ordinary shares aggregating to 109,134,409 shares of OMR0.100 each amounting to OMR10.91 million. They will also receive mandatory-convertible bonds of OMR0.015 per ordinary share of OMR0.100 each aggregating to OMR32.74 million (including issue expenses), which will carry a coupon rate of 3.5 per cent per annum, payable every six months.

The bonds will mature after a period of three years from the date of issuance. On maturity, the bonds will be converted to ordinary shares of the bank by using a 'conversion price' which will be calculated by applying 20 per cent discount to 3-month average share price of the bank on the Muscat Securities Market prior to the conversion. The bonds will be listed on the Muscat Securities Market.

Bank Muscat posted a net profit of OMR163.23 million in 2014 compared to OMR152.19 million in 2013, an increase of 7.3 per cent. The basic earnings per share were OMR0.075 in 2014 as against OMR0.072 in 2013. The banks' capital adequacy ratio stood at 15.92 per cent after appropriation for proposed dividend for the year 2014 as against the minimum required level of 12.625 per cent as per Basel III regulations issued by the Central Bank of Oman.  

(Times Of Oman / 21 March 2015)

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