1. Introduction and Objective
This Policy has been framed in accordance with Bangladesh Securities and Exchange Commission (BSEC) directive no. BSEC/CMRRCD/2021-386/03 dated 14 January 2021 and amendments thereto. The objective is to set out the principles and criteria to be considered by the Board of Directors before Mercantile Islami Insurance PLC (MIIPLC or "the Company") recommends and distributes dividend to its shareholders for a financial year.
2. Statutory and Regulatory Requirements
The Company shall declare and distribute dividend only after ensuring compliance with all applicable statutory and regulatory requirements, including the Companies Act 1994, Insurance Act, BSEC rules and the Articles of Association of the Company.
3. Types of Dividend
The Company shall declare two types of dividend:
- Cash Dividend
- Stock Dividend / Bonus Shares
No bonus/stock share will be declared as interim dividend.
4. Process for Declaration and Distribution of Dividend
The Board of Directors recommends/declares and distributes dividend as per the Companies Act 1994, the Articles of Association and BSEC's guidelines/notifications.
- Interim dividend is paid to entitled shareholders within 30 days of the record date.
- Final dividend is paid within 30 days of approval of shareholders at the Annual General Meeting.
- Cash dividend is paid directly to the shareholder's bank account through BEFTN as available in the BO account.
- Undistributed/unclaimed cash dividend (with interest) for 3 years from declaration is transferred to the fund as directed by BSEC.
- Stock dividend/bonus shares are credited to the BO account within 30 days of declaration, subject to DSE and CDBL clearance.
- Unclaimed bonus shares for 3 years are transferred in dematerialized form as directed by BSEC.
5. Circumstances Under Which Shareholders May or May Not Expect Dividend
The Board may vary the level of dividend, or not recommend any dividend, based on regulatory eligibility criteria, capital and solvency position, the need to conserve capital, or funds required for contingencies. The Board may recommend higher dividends, subject to applicable regulations, if the capital and solvency margins support it.
6. Review and Modifications
The Board shall review this policy annually or as required by law, and is authorized to amend it from time to time in line with the Companies Act 1994 and BSEC's regulations.
7. Limitation and Amendments
In the event of any conflict between this Policy and the Companies Act 1994, Listing Regulations or BSEC's guidelines, the provisions of such Act, Regulations or statutory enactments shall prevail. Any subsequent amendment in applicable laws shall automatically apply to this Policy.
8. Disclosure
The Company shall make appropriate disclosures as required under BSEC's guideline/directive dated 14 January 2021.