SOUTH African lender Absa said on Monday it would not declare a full-year dividend after profit fell 58%, falling behind two key rivals who managed to restore shareholder payouts in recent weeks.
After the central bank cautiously relaxed guidance advising lenders against dividends just weeks before results season, investors had been widely expecting a restoration of dividends from some lenders but were less certain about others, including Absa, whose capital position is not as strong as some peers.
“Given the group’s focus on preserving capital, it did not declare an ordinary dividend for the period,” Absa said, adding however it had delivered “respectable” progress against a turnaround strategy adopted in 2018 and this had good traction in some parts of the business.
Pre-provision profits, a key metric being watched by investors who want to get a sense of banks’ underlying performance without the impact of hefty COVID-19 bad debt costs,
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