Forty-two percent of the banks listed on the Dhaka Stock Exchange cannot legally pay you a dividend this year. Fifteen of thirty-six listed banks now sit in Z category — the DSE’s junk classification reserved for companies that fail to declare at least 10% dividend for two consecutive years. Of the twenty-one that remain technically eligible, only six actually declared dividends for FY2025.
If you hold a Bangladeshi bank stock for income, that is the universe you are choosing from. Six banks. And as we will see, even within those six, what looks like a “dividend payer” on paper translates to dramatically different cash in your hand.
The question every income-focused investor on the DSE is now forced to ask: which of the six are actually worth holding for dividend income — and which ones are dressing up capital retention as a payout?
The Six That Paid — and Why “Dividend” Doesn’t Mean What You Think
Looking at the six banks that declared dividends for FY2025 reveals just how wide the gap is between what gets reported as a “dividend” and what arrives in a shareholder’s account as cash.
Jamuna Bank declared 29% — all cash, no stock. On a Tk 10 face value, that is Tk 2.90 per share into your account. Pubali Bank declared 30% combined: 15% cash plus 15% stock. Bank Asia split 17% evenly: 8.5% cash, 8.5% stock. Uttara Bank declared 30% — but only 5% is cash, the other 25% is stock. Southeast Bank managed 10% — 3% cash, 7% stock. And Mutual Trust Bank declared 12% — every paisa of which is stock.
Same word, “dividend.” Wildly different economic reality. A stock dividend is the bank issuing more shares to existing holders. It does not put cash in your pocket. It dilutes earnings per share. It is, functionally, the bank telling you it cannot afford to pay you and is asking you to take more paper instead.
That distinction is what separates the tiers.
Tier 1: The Banks Actually Worth Holding for Income
Three names earn Tier 1 status. Each pays meaningful cash. Each has the earnings to back it.
Jamuna Bank (JAMUNABANK) declared the highest all-cash dividend on the DSE for FY2025. EPS of Tk 5.92 — doubled from Tk 2.97 the previous year. NAV per share of Tk 27.43. The 29% cash payout consumes roughly half of EPS, leaving room for the bank to retain capital and keep paying.
Pubali Bank (PBL) earned Tk 8.38 per share for FY2025 — the highest EPS among the six declarers, up 40% year-on-year — and translated that into 15% cash plus 15% stock. NAV per share of Tk 54.32 is the strongest in the group.
Eastern Bank (EBL) has not yet declared its FY2025 dividend, but the historical record is unmatched: a 5.48% dividend yield, a 31% payout ratio, and a ten-year increasing dividend trend. The low payout ratio is the signal — EBL is paying out less than it earns, which is precisely why it has been able to keep raising the dividend.
Tier 2: Moderate Payers With Warning Lights
Bank Asia, Uttara, and Southeast all declared something. None of them declared enough cash to be called an income holding.
Bank Asia’s 8.5% cash plus 8.5% stock looks balanced, and EPS rose 63% to Tk 3.18 — both genuine positives. The complication is the proposed authorized capital doubling to Tk 3,000 crore, which signals significant dilution ahead. Uttara’s headline is 30%, but its 5% cash portion is the smallest cash component in the entire dividend-declaring universe. Southeast’s 3% cash on a recovered EPS of Tk 2.51 — up from Tk 0.32 in FY2024 — is a recovery, not a return.
Tier 3: The Warning the Word “Dividend” Hides
Mutual Trust Bank declared 12% — entirely as stock. Zero cash. The stated reason is Basel III capital pressure. The plain reading is the bank is signalling it cannot afford a cash payout while meeting capital requirements. For an income investor, that is not a dividend. It is a notification.
Who Is Next
The same Basel III pressure that drove MTB’s stock-only payout, combined with rising NPL trends across the sector, is exactly what pushed fifteen banks into Z category in the first place. Any bank whose payout ratio is climbing while EPS stagnates belongs on a watchlist. Any bank shifting from cash to stock is sending the same signal MTB just sent. With more than half of all scheduled banks already ineligible, the dividend-paying universe is more likely to shrink than expand from here.
What the Six Are Really Telling You
The DSE banking sector has compressed an income investor’s choice set into a tier-one shortlist of three: Jamuna for cash yield, Pubali for the combination of EPS growth and payout, and EBL for the dividend track record itself. Tier 2 is a hold, not a buy. Tier 3 is a warning. And the thirty banks not on the list are either restricted from paying or have chosen not to.
When 42% of an entire sector cannot pay you, the remaining handful that actually pay you in cash is not a small list. It is the only list. The selling pressure that has dragged the DSEX through seven straight losing sessions is the market repricing exactly that reality.