Bank of Cyprus announces €112m dividend and a share buyback of up to €25m

Bank of Cyprus Holdings has announced that it has obtained approval from the European Central Bank to pay a cash dividend and to conduct a share buyback programme.

According to a relevant announcement from the Bank, the move demonstrates the Group’s strong financial performance and strategic progress.

"The Distribution corresponds to a 30% payout ratio1 for FY2023 and amounts to €137m in total, comprising a cash dividend of €112m and a share buyback of up to €25m. The payout ratio1 for FY2023 of 30% is in line with the Distribution Policy and represents a material increase compared to the previous year (14% payout ratio1 for FY2022).

The Distribution reflects the Group’s robust capital position, ample liquidity and continuation in the delivery of sustainable shareholder value.

Overall, the CET1 ratio on a transitional basis stands at 17.4%2 as at 31 December 2023 reflecting the 30% payout ratio1 for the year ended 31 December 2023," the announcement said.

Distribution Policy

It continued that the Group aims to provide a sustainable return to shareholders. "The Group’s Distribution is expected to build prudently and progressively over time, towards a payout ratio1 of 30-50% including cash dividends and buybacks, taking into consideration market conditions as well as the outcome of capital and liquidity planning," the announcement said.

Cash Dividend

The Board of Directors of BOC Holdings has resolved to propose to the Annual General Meeting that will be held on 17 May 2024 for approval, a final cash dividend of €0.25 per ordinary share in respect of earnings for the year ended 31 December 2023, a five-fold increase compared to €0.05 in prior year.

Subject to approval at the AGM, the cash dividend is expected to be paid on 14 June 2024 to those shareholders on the Company’s share register on 26 April 2024 with an Ex-Dividend date on 25 April 2024. Further details will be provided in the AGM Notice that will be published on or around 12 April 2024.

Intention of Commencement of a Share Buyback Programme

Furthermore, the Group announced that following the ECB’s approval, it intends to commence a programme to buy back ordinary shares in the Company for an aggregate consideration of up to €25m. It is expected that, once launched, the programme will take place on both the London Stock Exchange and the Cyprus Stock Exchange.

"The launch and implementation of the share buyback programme will comply with the Company’s general authority to repurchase the Company’s ordinary shares as approved by shareholders at the Company’s AGM on 26 May 2023, which is subject to renewal at the AGM scheduled to take place on 17 May 2024, and with the terms of the approval received from the ECB.

Further details concerning the proposed share buyback programme will be announced in due course," the Bank said.

Takis Arapoglou, Chairman of the Group (pictured above) commented, "Our ongoing commitment to delivering sustainable value to shareholders is demonstrated by our intended distribution comprising a significant cash dividend and our inaugural planned share buyback.

The total quantum of cash dividend is around five times higher than last year’s dividend and reflects the Group’s strong financial and operational performance in 2023 which resulted in a rapid organic capital build-up.

We are proud that the Bank, now in its 125th year, is well-capitalised, diversified and generates sustainable profitability. We remain focused on delivering shareholder value whilst continuing to support our customers, Cypriot society and the growth of the Cypriot economy."