Marfin Popular Bank surprised the market by declaring a CYP 0.18 or EUR 0.31 per share final dividend for 2006, for a 300% YoY increase, which based on the current level of EUR 8.14 per share, gives a dividend yield of 3.8%, the highest in the
MPB Chairman Soud Ba’alawy on his first visit to Cyprus and after a Board meeting promised a generous dividend policy, which may be increased from the current 62% payout ratio. For FY06 and based on pro-forma accounts combining the operations of the Marfin Popular Bank (formerly Laiki), Marfin Financial Group and Egnatia Bank, the Group earnings per share amounted to EUR 0.50 per share.
MPB CEO Andreas Vgenopoulos meanwhile said based on exceptionally well January 2007 figures, whereby advances increased 4.9% and deposits were up 2.9% from the end 2006 figures, MPB is confident that the EUR 360 mln guidance profit target for 2007 will be met and surpassed.
“The guidance figure of EUR 360 mln in net FY07 profits appears to be too conservative and when the first quarter results are released, we may proceed to revise the profitability figure higher,†said Vgenopoulos.
Last week the Financial Mirror revealed that MPB is set to easily beat the guidance figure by a minimum of EUR 50 mln, which is the profit that the Group will book if the sale of its stakes in Hellenic Bank to the Church and in Universal Life to the Aspis Group secure regulatory approvals.
In the event that Marfin Investment Group (MIG) proceeds with the EUR 5 bln capital increase, then based on the assumption that MPB will secure a 1% fee, this is likely to generate a minimum EUR 25 mln to EUR 35 mln for FY07, lifting the total improvement to at least EUR 435 mln, according to Financial Mirror estimates.
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Piraeus bid rejected
The Board of Directors of Marfin Popular Bank meanwhile considered a fairness opinion from Deutsche Bank on the proposed takeover bid submitted by Piraeus Bank, and having considered all aspects, decided to unanimously reject the deal.
The Dubai Fund, the largest shareholder of MPB with a 17% stake, together with other major shareholders including the Lanitis family, Andreas Vgenopoulos, the staff provident fund and the Tosca Fund holding in excess of 41% of the capital of the Bank have already rejected the all-share exchange offer made by Piraeus, which values MPB at half its current worth.
