Zenith Bank Mops Up Over 16m Units Of Own Shares In One Week
In about one week of what could be regarded as “operation mop up,” directors and staffers of Zenith Bank Plc snapped up a total of 16,429,515 units of own shares valued at about N326.947 million.
The tier-1 lender declared this In a series of filings, disclosing Director Dealings involving some executive directors and other members of staff in the name of Zenith Staff Provident Fund to the Nigerian Exchange between October 31 and November 8, 2022.
For instance, one such notice dated Nov. 7, 2022, indicated that on November 4, an Executive Director of the bank, Anthony Akindele Ogunranti, purchased 1,000,000 units at N19.90 per unit.
Another Executive Director, Denis Olisa, on October 28, 2022, snapped up 645, 000 units of the shares at N20 per unit. This was disclosed in a filing to the Exchange dated October 31, 2022, and signed by Michael Osilama Otu, the Company Secretary.
According to the notification filings, other transactions occurred in the name of Zenith Staff Provident Fund which is the equities investments vehicle for staff members.
In two such transactions, a total of 6,637,464 units were snapped up. The staff provident fund purchased an aggregate volume of 3,137, 464 units in five different deals on November 2, at an average per unit price of N19.85, the bank disclosed in a filing dated November 4.
Another filing dated November 2 showed that the same Staff Provident Fund purchased 3,500,000 units in three different transactions on October 31 at an average per unit price of N20.15.
All the transactions involving the bank’s staff members and directors occurred under the legal identifier “029200268F8M5Y151629”.
Commenting on the transactions, the Doyen of the market, Rasheed Yussuf, said there was no foul play because the deals were sealed strictly in line with regulatory rules.
Yussuf further explained that not only that the transactions followed the laid down rules and regulations, but there was also no evidence of anticipatory advantage by the insiders.
According to him, the fact that the Bank’s staff are mopping up the shares of their bank is an indication of the confidence in the capacity of the entity to deliver good returns.
On Friday, Zenith Bank Plc closed at N20.10, 6.35 per cent above its 52-week low of N18.90, set on Jul 28, 2022. The share price had stood at N27.50 per share on Feb 1, 2022. The percentage decline in its share price stood at -19.7 percent since this year, creating investment opportunities for equities investors.
In the year 2021, Zenith Bank paid a final dividend of N2.80 per share to shareholders after an interim dividend of 30 kobo per 50 kobo shares for the year 2022, indicating 18 percent earnings per share ratio.
Going by the Tier 1 lender’s record of sustained increase in dividend payout, analysts are forecasting a final dividend of at least N2.70 for this year.
While analysts at Afrinvest Securities Limited have projected an average of 14 per cent dividend yield, the chief analyst at APT Securities and Funds Limited, Garba Kurfi, said the stock looks good to yield a minimum of 15 per cent in dividends and much more in capital appreciation.
“Equities investors looking to get good returns in short term should pick Zenith Bank which has a tradition of sustained annual dividend yield of about N3 per 50 kobo share,” Garba Kurfi told InsideBusiness over the telephone.
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