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Sampo to distribute extra dividend in the form of Nordea shares.

M2 EQUITYBITES-August 8, 2019-Sampo to distribute extra dividend in the form of Nordea shares


Finnish financial company Sampo Oyj (HEL:SAMPO) reported on Wednesday that its board of directors, as planned and previously announced on 13 June 2019, has resolved to distribute an extra dividend in the form of Nordea Bank Abp (STO:NDA) shares.

Under this distribution, each shareholder will receive one Nordea share for each 10 Sampo shares owned. Fractional entitlements to Nordea shares resulting from the distribution ratio will not be distributed in the form of shares, but an equivalent amount will be compensated to shareholders in cash.

The ex-dividend date is 8 August 2019 and the record date 9 August 2019. The payment date is 12 August 2019 for the share dividend and 16 August 2019 for the cash compensation.

Also, in Finland, a share dividend is taxed similarly as cash dividend. Sampo will pay the Finnish transfer tax of 1.6% resulting from the distribution of the share dividend on behalf of shareholders.

As a result of the distribution of this extra dividend, Sampo's ownership in Nordea Bank will decrease below 20%. Hence, in the future, the group's solvency will only be calculated by the Solvency II rules and Nordea Bank will be treated as a normal equity investment.

At the end of June 2019, Sampo's solvency ratio, according to the Solvency II directive, amounted to 137%. Taking the distribution of an extra dividend into account, the solvency ratio would have been approximately 170% at the end of June 2019.

Reportedly, withdrawing from the conglomerate rules (FICO) solvency calculation is subject to formal approval by the Finnish Financial Supervisory Authority. Sampo expects to receive this approval before the release date of the January 2019 to September 2019 interim statement.

Sampo clarified that the consolidation of Nordea Bank as an associated company in Sampo's financial statement (IFRS) will remain unchanged.

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Publication:M2 EquityBites (EQB)
Date:Aug 8, 2019
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