Global Islami Bank to propose no dividend for 2023 as audit finds heavy losses
In the recently revised financials, a newly appointed auditor found that the previously S Alam Group controlled bank had actually incurred significant losses in 2023
Global Islami Bank has decided to propose no dividend for 2023 to its shareholders, replacing the previously recommended 5% stock dividend and 5% cash dividend.
The decision was taken on Thursday following a DSE query regarding the revised financials of 2023, according to a disclosure on the DSE yesterday.
In the recently revised financials, a newly appointed auditor by the bank's reconstituted board found that the previously S Alam Group controlled bank had actually incurred significant losses in 2023, despite announcing profits earlier.
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The bank's former board had recommended the 10% dividend for 2023 in April 2024, showing inflated financials – a profit of Tk128 crore. But the audit found that Global Islami Bank actually incurred a loss of Tk2,259 crore for the year.
The declared dividends were supposed to receive shareholder approval at an AGM scheduled for 8 August, while the stock dividend was subject to approval by the commission.
Later, the commission approved the stock dividend, but a day before the AGM, on 7 August, the bank postponed the meeting, citing unavoidable circumstances.
After the ousting of the Awami League-led government on 5 August last year, and with its board reconstituted, the bank failed to hold its AGM, which prevented the earlier dividend declaration from being approved.
As per listing rules, the decision about recommending or not recommending dividend and entitlement for such dividend, if recommended, cannot be changed prior to holding of the AGM and no dividend shall be paid other than out of profits of the year or any other undistributed profits.
After incurring substantial losses in 2023, Global Islami Bank reported a loss of Tk1,308 crore in 2024 due to a significant increase in classified loans.
Just three years after listing on the stock exchanges and raising funds from the capital market, the lender decided not to pay any dividend for 2024.
Since listing in 2022, it has paid 5% cash and 5% stock dividend to its shareholders.
Global Islami Bank raised Tk425 crore fund from the stock market through an IPO in 2022.
The Bangladesh Securities and Exchange Commission (BSEC) approved the capital raising in June 2022. Although the bank issued shares at a face value of Tk10, its current share price stands at only Tk3.30 each.
Due to its failure to hold the annual general meeting (AGM), the company's shares are now trading under the Z category.
