Oyetunji Abioye
The Central Bank of Nigeria has stopped the payment of dividends to shareholders by Deposit Money Banks and discount houses with huge bad loans and low capital base.
This is due to the rising non-performing loans and the need to stop further erosion of the capital base of the banks and discount houses.
The directive is coming barely a week to the release of the 2017 financial year’s annual reports by commercial banks and discount houses in the country.
The development has dashed the hope of many shareholders as a number of the banks will be affected by the directive and consequently unable to pay dividends.
The CBN said the move was aimed at stemming the tide of rising non-performing loans and the consequent weakening and erosion of the banks’ capital base.
The directive was handed down in a letter dated January 31, 2018.
In the letter to the banks and discount…
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