Bonus Issue

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Bonus Issue

The free distribution of new shares to existing shareholders. A bonus issue is most common when the issuer does not wish to increase its dividend when it is expected to do so, especially when it may be cash poor. Instead of the increased dividend, shareholders receive the additional shares. Shareholders receive the bonus issue in proportion to the number of shares they already own. A bonus issue is also called a scrip issue. See also: Antidilution Provision.
References in periodicals archive ?
Saudi Hollandi Bank received an approval to increase its capital from SR2.65 billion to SR3.31 billion through issuing 1 bonus share for every existing 4 shares owned by the shareholders.
Announcing the bonus shares at RIL's shareholder meet, its chairman Mukesh Ambani said, "On such an occasion (40th IPO anniversary) and in keeping with our founder's vision to share prosperity with all shareholders, the board has decided to recommend a bonus issue in the ratio of 1: 1." He added that it will be the country's biggest such offer.
The board also approved a bonus share issue of 10 percent of the bank's share capital, totalling 154.47 million shares of OMR0.100 each, subject to regulatory approvals.
"The final outcome is particularly disappointing given that a clear majority (over 60%) voted in favour of the original scheme proposed in September 2012 and we narrowly missed the required support for the Supplemental Executive Bonus Share Scheme."
Bonus shares have been added to all shareholders' accounts, while cash dividends will be valued on April 30.
1 March 2012 - First Gulf Bank plans to issue bonus shares worth AED1.5bn (USD408m/EUR306m) to boost its paid-up capital, the Abu Dhabi-based lender said in a bourse filing on Thursday.
Board also suggests a bonus share issue of 1 share for every 10 held
"It became a bit much for the average private shareholder, so we have made the proposal that we should divide it by five by issuing four bonus shares for one share."
This is equivalent to Dh0.10 per share representing 500 million bonus shares on the five billion shares that make up its capital, the company said in a filing to the Dubai Financial Market.
BANKING AND CREDIT NEWS-January 30, 2012--QNB boosts capital via 10% bonus share issue(C)2012 M2 COMMUNICATIONS http://www.m2.com
Saudi's Yamama Saudi Cement Company plans to increase its capital by 50 per cent through a bonus share issue, the firm said in a bourse statement.
Saudi Hollandi Bank has proposed to increase its capital by 20 percent through a bonus share issue, according to Reuters.