The Board of Directors of Bank Alfalah Limited (PSX: BAFL) has recommended sub-dividing the bank’s shares, reducing the face value from Rs10 to Rs5 per share.
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The Mechanics
Under the proposed 2-for-1 split, shareholders will receive two shares for every one share they currently hold. The bank also plans to amend its Memorandum and Articles of Association to reflect the change.
The Status
The proposal is subject to shareholder approval. A date for the shareholder meeting has not yet been announced.
The Earnings Context
The share split proposal comes alongside the bank’s full-year results for calendar year 2025:
- Profit After Tax: Rs27.80 billion, down 30.3% from Rs39.86 billion in CY24.
- Earnings Per Share (EPS): Fell to Rs17.62 from Rs25.27 last year.
The Dividend
The board announced a final cash dividend of Rs3 per share (30%). This is in addition to three interim cash dividends of 25% each already paid during the year.
The Bottom Line
Bank Alfalah is making its shares more affordable for retail investors through a split, even as it reports a sharp decline in annual earnings. The move typically improves liquidity and broadens the shareholder base, though the final decision now rests with shareholders.
