Bank of Baroda Uganda lists 600 million bonus shares on stock exchange

Monday June 6, 2011

Investors will have more options to buy shares after Bank of Baroda listed 600 million bonus shares at the stock exchange last week.

Baroda also did a share split a few years ago.

Experts are confident that the development will enhance liquidity in a market devoid of active trading.

“In the last two months, turnover has dropped a bit, but that is the market.

“The entry of Bank of Baroda means more additional shares,” said Joseph Kitamirike, the Uganda Securities Exchange boss.

Liquidity is the degree to which a security (a share) can be bought or sold in the market. Stanbic is the most liquid company because it can easily be bought and sold.

Kitamirike said they were concerned about the erosion of shareholder value caused by the high inflation.

“What we have to ensure is that the market is vibrant and this event (listing) brings significant increase in liquidity,” said Kitamirike.

Bank of Uganda governor Tumusiime Mutebile hailed Baroda’s consistent performance. Baroda’s profits jumped from sh7.5b in 2006 to sh21.2b in 2010.

“I have noted over time that Bank of Baroda shares have continued to attract a premium price at the stock market,” said Mutebile.

By David Mugabe: The New Vision Newspaper