The Romanian Commercial Bank will pay dividends to shareholders totalling RON 367.92m, translated into a 46.9% payout ratio of last year total net profits of RON 783m. Of this profit, RON 120m was deducted into funds for general banking risks, resulting a RON 662m profits to be distributed in 2006. Using this level of profit, the payout ratio stands at 55.56% level. Another RON 294.34m was earmarked for reserves. Dividends reach RON 0.4642/share, as against RON 0.4541/share in the previous year, reads a BCR news release. Shareholders also agreed with the appointment of Ernst&Young as the bank’s financial auditor for the financial years of 2007 and 2008.
Our view: Following the approval of granting dividends proposal, Erste
Bank will earn around EUR 76m for its 69.148% stake in BCR, while the SIFs will receive an overall amount of EUR 33m for their cumulated stakes of 30%. Although the gross dividend level (voted during the GSM) was already known, we expect some slightly positive trading impact on SIFs today, as investors usually react favourable at this type of news.