Novobanco shareholders approve dividends of 224.6 million on 2024 profits
The AGM also approved the payment of 60 per cent of each year's profit. The bank has a further 3.3 billion to return to shareholders over the next 3 years.
Novobanco’s shareholders approved on Friday the distribution of 224.6 million euros in dividends for the 2024 financial year, representing 60% of the net profit for the second half of the year, a ratio that the bank intends to apply from now on in relation to annual results.
‘Novo Banco, S.A. informs that the General Shareholders‘ Meeting of 21 March 2025 approved the payment of dividends in the amount of 224.6 million euros for the financial year 2024,’ the institution said on Monday in a statement published on the website of the Portuguese Securities Market Commission (CMVM).
‘As announced on 6 March 2025, when the results were presented, the dividend reflects a pay-out ratio of 60% of the result generated in the second half of 2024″, it said.
The American fund Lone Star, which holds 75 per cent of the bank’s capital through Nani Holdings, will receive 168.45 million euros on the 2024 results, the Resolution Fund, which has 13.54 per cent, will receive 30.4 million and the Portuguese state 25.7 million through its 11.46 per cent stake.
This could be another chapter in the sale process that could materialise in May through a market operation, namely an IPO, which could value the bank at up to 6.2 billion euros, according to the latest analysis by JB Capital.
However, the purchase of the bank by a national or foreign rival is not ruled out, and several CEOs in the sector commented on the possibility during the results season.
End of CCA opened door to dividends and IPO
Of the nine items on the agenda for the general meeting, three related to dividends, a forbidden topic within the bank until recently. According to the notice of meeting, the following items were on the agenda: item 2 on the proposal for the appropriation of profits; item 8 on learning about the Dividend Distribution Policy; and item 9 on an amendment to the articles of association regarding dividends.
On 6 March, when it announced a record profit of 744.6 million in 2024, Novobanco explained that it would propose to the general shareholders’ meeting the distribution of a dividend totalling 224.6 million euros.
This amount corresponds to a pay-out of almost 30.2 per cent of the annual net profit, ECO calculated, and 60 per cent of the profit for the second half of the year, as the company informed CMVM. The bank also said that it intends to distribute up to 60 per cent of its profits annually.
‘The distribution policy for shareholders defines a level of ordinary dividend distribution of between 40 per cent and 60 per cent of consolidated net profit,’ it explained.
The bank stressed at the time that several performance and ratings milestones, but especially the early end of the Contingent Capital Agreement, formalised in December 2024, allows it to start distributing dividends to its shareholders, something that had been forbidden since its creation in 2014, when it emerged following the resolution of Banco Espírito Santo (BES).
The bank led by Mark Bourke said that the dividend policy was approved in January 2025 and that the proposal for the 2024 results was for a ratio of 60 per cent of profits, in this case based on the second half of the year, but that ‘it will be applied to the full financial year of 2025’.
In addition to the 225 million euros in dividends for 2024, Novobanco has 3.3 billion euros to distribute over the next three years in extraordinary dividends and a share buyback plan.