Dividend Policy

Dividend Policy

DIVIDEND POLICY

Dividend payments are part of the Bank's commitment to delivering value to shareholders.

The Bank has not adopted a formal dividend policy, but may do so in future years. In determining the Bank's dividend payout for a particular year, the Board of Directors considers a variety of factors including the Bank's outlook for earnings growth, liquidity requirements, capital expenditure requirements, cash flow from operations, acquisition and business expansion strategy, debt position, capital position and capital adequacy rules. The Bank seeks to adopt a progressive approach to dividend payments, subject to the foregoing considerations and also subject to prescribed statutory limitations regarding the amount available for distribution. In particular, as required by UAE laws, the Bank's articles of association (Article 82) specify that the Bank's net annual profits shall, after deduction of general expenses and other costs, be distributed as follows: (a) 10% will be deducted and allocated to a statutory reserve account (b) a further percentage shall be deducted from the profits and allocated to any established voluntary reserve account (c) not less than 5% shall be distributed to shareholders (d) a maximum of 10% of net profit shall be allocated as remuneration for the Board, but only after approval of the General Assembly, and (e) the remaining profits shall be retained or distributed to shareholders as the Board shall recommend.

Generally, dividends shall be paid out in cash or bonus shares, on an annual basis, shortly after the Bank's annual general assembly.