The idea of taking out loans without interest rates as the future of banking might still sound as foreign as flying cars to many, but it is already in motion.

Currently, there are over 300 Islamic banks in over 51 countries, including the United States. In Nigeria, Jaiz bank stands at the forefront of this revolution. The bank was created out of the former Jaiz International Plc, which was set up in 2003/2004 as a Special Purpose Vehicle (SPV) to establish Nigeria’s first full-fledged Non-Interest Bank.  

Jaiz and its unconventional Banking methods 

With Islamic banking, there are two main peculiarities and none of them confer a bias on only members of the religion. The first is the sharing of profit and loss, and the other is the prohibition of the collection of interest as stipulated in Islamic law – otherwise regarded as “riba.”

Both concepts feed off each other in that to augment the lack of interest gains, equity participation is employed. In other words, the borrowing business will pay back the loan without interest and also give the bank a share of its profits.  

Jaiz bank is the first non-interest (Islamic) bank operating in Nigeria. Being that Islamic banking is grounded in Sharia or Islamic principles and morals, the financial institution does not support businesses that could impact the society negatively.

So even as it finances business, and shares their risks and profits accordingly, it does not partner with businesses involved in betting, alcohol, and so on. Needless to say, their methods have served them well.

From being founded in 2003, to 2011 when it received a license from the CBN to operate as a regional bank, to its official commencement as Jaiz Bank Plc in 2012, the institution has expanded its services exponentially.

Today, the company is owned by over 26,000 shareholders who are spread over Nigeria’s six geopolitical zones and its balance sheet has grown from N12 billion in 2012 to about N62 billion, with asset financing of over N30 billion. The bank operates 27 branches and has a full service range of offerings.

The force behind  

Behind the bank’s recorded success is a strong shareholder base, spread across one foreign shareholder, 108 Institutional, 220 Corporate, 26,157 Individuals, 156 Joint, 6 States and 106 Local Government shareholders.

However, seven major shareholders control a total of about 65% of the total share capital of the bank. They include: Dantata Aminu Alhassan having 5.24%, Altani Investment Limited with 7.47%, Dangote Industries Ltd wit 8.48%, Islamic Development Bank (IDB) with 8.50%, Indimi Muhammad with 9.28%, Dantata Inv’t & Sec. Ltd with 12.49%, and, former minister, Mutallab Umaru Abdul with the highest stake of 13.50%.  

Not only have these business magnates from the northern part of the country created something of an oligarchy, they also obtained the backing of Saudi Arabia’s Islamic Development Bank.

Whether or not the oligopoly poses a threat to the corporate governance and decision-making power of the rest of the bank’s shareholders is a question that can only be answered based on the happenings that arise. 

The Managing Director of the bank, Hassan Usman, had however noted that “fundamental to the vision and mission of Jaiz Bank is to create wealth for MSMEs.” He also assured all that the bank is set to ensure maximum benefits is attained by all stakeholders. 

Performance and Investment Outlook 

The company has done well in building up funding to keep its operations afloat especially given its style of banking. Just last year, it had secured a N3 billion financing facility from the Bank of Industry (BOI) to boost and develop their operations and give zero-interest loans to Micro, Small and Medium Enterprises (MSMEs) within the country.

The company’s performance has also been noteworthy. In 2019, the company declared a profit after tax of N1.79 billion which was a 114% growth as compared to the N834.36 million recorded at the end of 2018.

The company is on a growth trajectory; currently, with its low share price of N0.66 on a 52 week average of 0.34 and 0.82, it is a convenient buy.

With a price-to-earnings ratio of 9.27, it shows good signs of growth. Its model might just be the thing to spur economic growth as its result-based gains will not just increase the income of the bank but also aid the growth of small businesses within the nation. 

As audited accounts start to trickle in, companies will propose dividend payments to their shareholders as recommended by their respective boards of directors. It is also important to track these announcements to know who is eligible to collect the dividend, when it will be approved and when it will be paid. Dividend payment also affects share prices.

This page will be updated from time to time.

READ ALSO: Updated: Gender Balance, looking at the board composition of top banks on the NSE

Legend

Date Announced – The date the company announced dividends evidenced by a corporate action published on the website of the NSE.

Qualification date – Shareholders who own shares as of this date will receive dividends. If you buy shares and want to receive dividends make sure it is at least three days before this date. Shares get transferred to you on the basis of the T+3 rule (the date you bought plus 3 working days).

Payment date – This is when the dividend will be paid to you, either via post (dividend warrants) or direct credit to your bank accounts (e-dividend).

Calculate Dividends

Closure of Register – Only shareholders who own shares listed in their register before this date will be paid dividends.

You can also scroll sideways to view the rest of the columns if using a mobile phone.

READ MORE: How to read stock market tables

2020 Dividends from companies quoted on the Nigerian Stock Exchange

Subscribe to Stock Select Newsletter by Ugodre

Lafarge Africa Plc, a unit of LafargecHolcim Group – one of the biggest building and concrete solutions companies in the world, has had a pretty long run in the construction sector. With projected growth in urbanization and inevitable population expansion, the leading producer of building materials and construction solutions has its stake in the huge Nigerian housing market. The company had served customers in Nigeria and South Africa (now discontinued) for decades, their customer base cutting across individuals requiring small building projects to major construction and infrastructure projects. All of these do well to place the company as an active participant in the economic growth of Africa.

Yet, so much has plagued the company in the past few years, curtailing its success with avoidable losses and below-par profits. While it, no doubt, has a series of challenges to worry about – like most organizations – three of its biggest Achilles’ heels had been its failing South African operations, its incessant changes in its corporate leadership, and of course, the one pandemic threatening to rip the global economy to shreds – COVID-19.

Lafarge South Africa

The company’s experience with its South African subsidiary gives credence to the phrase, “If anything is not serving you well, cut it off.” After years of dragging the African cement-maker down, the subsidiary was eventually spun off in July last year – not before it incurred a final loss of N3.2 billion in the first quarter of 2019. It was only after, when Lafarge restated its accounts by adjusting figures from the discontinued operations from its books, that the company set off on a positive growth trajectory.

Following the sale of Lafarge South Africa Holdings (LSAH) in Q3, there was a remarkable improvement in gross and operating margins, clearly showing that the sale of LSAH was valued accretive to shareholders. For one, the total debt reduced drastically. Short term loans and long term loans also had a drop of 79% and 75% respectively in comparison with the first quarter of last year. Other financial assets increased significantly from N1.7 billion in 2019 to N4.8 billion in Q1 2020. Also resulting from the sale was the increase in EPS from Q1 2019 of 0.36 to Q1 2020 of 0.93.

(READ MORE: Analysis: Total Nigeria needs a financial overhaul)

Khaled El Dokani, CCEO of Lafarge Africa had stated, “Our turnaround and cost-reduction strategy in FY 2019 and the divestment of the South African business, have delivered strong results. The decrease in net debt has significantly strengthened our balance sheet and has placed us in a vantage position to face the future.”

Its Changing Leadership

In 2018 alone, the firm appointed four directors in the space of three months. 9 months ago, in September, former CFO of Lafarge Africa Plc., Bruno Bayet, resigned.  Just a month later, the board had announced the appointment of Lolu Alade Akinyemi as the new CFO. Next, the group CEO, Michel Puchercos, also resigned leaving Khaled Abdelaziz El Dokani in charge. Even amidst the challenges of 2020, Jean-Philippe Benard resigned from being a Non-Executive Director in January 2020 and by April, the retirement of two Non-Executive Directors was announced, as well as the appointment of three new directors. The high turnover of its leadership means one (or both) of two things. The first is the possibility that there could be more than meets the eyes within the company and the second is the truth that the newer leadership will need time to adjust to the company’s operations before the wins.

COVID-19

Just when things started looking up, COVID-19 came with all its challenges and it didn’t help that the first carrier of the virus – an Italian man, had been visiting Lafarge Africa’s factory in Ogun State. The loss in the demand for cement with the stalled construction activities will pose an additional challenge for the organization. In the performance summary released alongside the financials, the company had noted that the pandemic “will adversely affect the company’s results in Q2, 2020.” This is also coupled with the burgeoning competitive landscape with bigger brands like BUA and Dangote owning larger market shares.

While the company seems to be moving in the right direction, it might take a while for things to pick up. At its current price of N11.65 juxtaposed with its indicative dividend yield of 8.58%, the company could serve as an easy buy capable of yielding dividend income while investors wait patiently and hopefully for its wins to come.