Monday, March 14, 2011

Bursa Malaysia: Public Bank says 50% dividend payout policy

KUALA LUMPUR: PUBLIC BANK BHD [] has assured shareholders that it was in the position to maintain its 50% dividend payout policy in the medium term despite the impending Basel III requirements.

Public Bank chief operating officer Leong Kwok Nyem on Monday, March 14 told shareholders that Public Bank aimed to balance between the need to meet regulatory capital requirements and the needs to optimise returns to shareholders.

"The group's strong earnings generation capabilities will help the group to have the capital to support its strong organic growth strategy and to maintain its dividend payout ratio," Leong said, in response to questions from shareholders at Public Bank's annual general meeting today.

Public Bank recently announced its fourth quarter ended Dec 31, 2010 (4QFY10) results which saw net profit grow 24.85% to RM846.19 million from RM678.23 million a year ago, driven by higher interest income, fee-based earnings and smaller provision for bad loans.

This was on the back of a 18.8% revenue increase to RM2.97 billion from RM2.5 billion a year ago.

For the 12 months, Public Bank's net profit rose 21% to RM3.05 billion from RM2.52 billion a year ago while revenue rose 13.6% to RM11.04 billion from RM9.72 billion.

For its 4QFY10, Public Bank declared a cash dividend of 33 sen per share, comprising a franked dividend of 25 sen less income tax and a single-tier dividend of eight sen per share.

Public Bank's total gross dividend payout for FY10 was 58 sen per share.

To a shareholder's question about a rights issue, Leong said Public Bank had the capital to support its strong organic growth strategies without having to return to shareholders in a rights issue exercise.

Leong added that Public Bank's capital ratio were healthy, at 10% for its Tier 1 Capital ratio, 13.7% risk weighted capital ratio and 7.2% core equity capital.

Asked about overseas expansion plans, Public Bank co-chairman Tan Sri Thong Yaw Hong assured shareholders that the bank's board and management was always alert about opportunities and mindful of its challenges.

One shareholder had voiced concern that Public Bank had been less aggressive than its competitors in overseas expansions.

Meanwhile, in a statement Public Bank said it plans to add six branches to its existing 21 branches in Cambodia, four new branches in Vietnam and one new branch in Laos this year.

Overseas, Public Bank currently has 81 branches in Hong Kong, three in Shenzen, China, seven in Vietnam, three in Laos and one in Sri Lanka.

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