The board of Hungary's OTP Bank will propose shareholders to limit voting rights to 10% of the shares at the bank's annual general meeting (AGM) on April 30, motions for the AGM published on the website of the Budapest Stock Exchange show.
Shareholders at the previous AGM held in April 2009 had rejected a similar proposal, with approval blocked with the vote of one large shareholder.
The bank's articles of incorporation currently limit voting rights to either 25% or 33%. The latter limit applies if there is any one shareholder or shareholder group holding more than 10% of the votes.
Limiting voting rights is necessary to prevent any shareholder or group of shareholders to have excessive power in shareholders' decisions, the board argued for the motion. The bank's shareholder structure can easily change significantly in the present financial and economic environment and at the current prices of the stock, they added.
OTP Bank board has not published a dividend proposal on 2009. The bank paid no dividend on 2008 and put all 2008 profit into profit reserves.
OTP Bank’s net income fell 37% to HUF 151.2 billion in 2009 as risk provisions grew, but the bottom line was slightly over the management’s HUF 150 billion target, the bank’s unaudited consolidated IFRS report showed. (MTI – Econews)