On June 18, Kashi bank announced that, under the guidance of the regulatory department window, it was required to distribute 0.8 yuan (before tax) of undistributed profits to shareholders for every 10 shares in accordance with the principle of less dividend and more retention.
Compared with the dividend plan approved by the shareholders meeting of Kashi bank, the cash dividend of the new plan is reduced by 20%.
In this regard, a number of interviewees told the securities companys Chinese reporters that it is rare to adjust the dividend plan that has passed the deliberation of the general meeting of shareholders.
Supervision department window guides less dividend and more retention
Recently, the Bank of Kashi received a telephone notice from the insurance regulatory branch of the Bank of Kashi. According to the guidance of the window and the principle of less dividend and more retention, the Bank of Kashi is required to distribute 0.8 yuan (for distribution) of equity to all shareholders for every 10 shares with undistributed profits, according to the announcement.
The bank said that in order to meet the needs of long-term development and properly handle the relationship between business growth, profit distribution and capital replenishment, it will distribute its rights and interests in accordance with the opinions of Kashi banking regulatory bureau.
Prior to this, Kashi bank disclosed the annual equity distribution plan as follows: distribute 1 yuan (including tax) of cash dividend to all shareholders for every 10 shares with undistributed profits. The plan was approved by the board of directors at the end of April and passed by the general meeting of shareholders on May 22.
It is worth noting that as early as the first disclosure of the distribution plan, Kashi bank said in the announcement: the distribution plan can only be implemented after the approval of Kashi banking regulatory bureau. If the bureau gives different opinions on profit distribution according to the regulations, it will implement the share bonus plan according to the approval of profit distribution.
Interviewees said rare
Interviewees generally said that in fact, every year, the regulatory authorities will have similar window guidance, requiring less dividend and more retention, which is not a new wording. Banks will also consider regulatory opinions and comprehensively determine the final dividend plan.
Each banks dividend plan is the result of multi-party balance, the key reason is the different stations. The head of the joint-stock banking department told the securities companys Chinese reporter.
According to the person in charge, from the perspective of the regulatory authorities, commercial banks should better play the role of social credit creation, which requires banks to have certain capital to increase investment and support the real economy more. In the case that capital supplement channels (especially core tier one capital) are not unblocked, reducing dividends and increasing profit retention are the main choices. However, from the perspective of shareholders, all of them must be I hope the bank will pay more dividends.
Another secretary of the board of directors of a listed bank also said that Kashi bank and the regulatory authorities obviously did not communicate in place.
There is another possibility that the regulatory authorities have a say in advance, but if the bank does not implement the regulatory provisions and passes the deliberation of the general meeting of shareholders first, the regulatory authorities will certainly not agree with it.
At the same time, the interviewees did not question the rationality of the window guidance of the local banking and Insurance Regulatory Bureau for Kashi bank to reduce the dividend.
According to many banking analysts interviewed, on the one hand, it is only for the guidance of individual small banks; on the other hand, it needs to see whether the dividend rate of Kashi banks original plan is too high.
In the case of increased liquidity pressure and debt pressure, and unclear asset quality and potential risks, some small banks should not pay dividends. In the current environment, its impossible for such a bank with weak anti risk ability to make efforts to pay dividends. Analysts at a large brokerage bank said.
In fact, in the view of the aforesaid listed bank secretary, Kashi banks original cash dividend ratio of 32.23% is indeed too high, especially in the sequence of agricultural commercial banks.
By the end of last year, the bank had a total share capital of 507 million shares, of which Xinjiang Jintou, a subsidiary of the state owned assets supervision and Administration Commission of Xinjiang, held 9.96%, the largest shareholder.
By the end of last year, the total assets of Kashi bank were about 14.3 billion yuan, with a capital adequacy ratio of 15.94%, a non-performing loan ratio of 2.29%, and a provision coverage ratio of 234.17%. In 2019, the bank achieved an operating revenue of 500 million yuan, a year-on-year increase of 6.3%, and a net profit attributable to the parent company of 160 million yuan, a year-on-year increase of 96.5%.
In fact, prior to the adjustment of the profit distribution plan, Kashi bank had many records of equity change and executive qualification disqualification.
On May 20, this year, the Kashi Bank Insurance Regulatory Bureau issued a message that Wang Yun, assistant to the president of Kashi bank, and Tian Xiaolong, general manager of compliance risk department, were denied their qualifications on the grounds that they do not meet the qualifications of senior managers of rural small and medium-sized banks. In August last year, due to the violation of relevant regulations by the pledge of new shareholders equity, a change of equity of Kashi bank was also vetoed by the former Kashi banking regulatory bureau. Before that, Dezhan financial investment group transferred 35 million shares from Xinjiang Tongwei investment, becoming the second largest shareholder of the bank. In addition, the annual report of Kashi bank revealed that the shares held by the fourth and fifth largest shareholders of the bank were all frozen by the judiciary, accounting for 7.52% of the total share capital of the bank. It is also disclosed in the annual report that by the end of 2019, the loan concentration of the top ten customers of Kashi bank is 76.23%, which is 5.76% lower than that of the beginning of the year, but still higher than the requirement that the loan concentration of the top ten customers of Kashi bank regulated by the supervision should be less than or equal to 50%. Source: responsible editor of Securities Times: Yang Bin_ NF4368
On May 20, this year, the Kashi Bank Insurance Regulatory Bureau issued a message that Wang Yun, assistant to the president of Kashi bank, and Tian Xiaolong, general manager of compliance risk department, were denied their qualifications on the grounds that they do not meet the qualifications of senior managers of rural small and medium-sized banks.