The dividend payment is the very important part of investment decision for many stockholders. Results of this text identify finance factors that influence the management in dividend policy within the examined branch “Production and distribution of electric energy, gas and water”. Seven regressive models were created and they identify and define the effect of individual factors on the dividend payment among individual owner’s types. The retained earnings, the rate of return of invested assets in total and the size of company have the positive effect on the dividend payment. For the purpose of better interpretation the individual factors were quantified in form of the chance that the company will pay the dividend when compared to the fact that the company is not going to pay any dividend. The resulting regressive model was subsequently validated using the classification table and the receiver operating characteristic curve.
Odunayo Magret Olarewaju, Stephen Oseko Migiro and Mabutho Sibanda
Dividend policy remains one of the top ten unresolved issues in corporate finance including in the banking sector. Hence, this study explores data from 250 commercial banks in 30 Sub-Saharan African countries to establish the causal relationship between the use of two major dividend policies in the sector and financial performance for the period 2006 to 2015. The empirical results of the vector error correction block exogeneity Wald test and Pairwise Granger causality test reveal that only retention policies Granger cause performance (ROA), even though both major policies posit a positive relationship with performance (ROA) in the Vector Error Correction Model estimate. Therefore, commercial banks in Sub Saharan Africa and also in the entire world should use their free cash flows wisely by exploring all available viable investment opportunities. By doing this, not only owners’ profit but wealth is fully maximised such that their survival, value creation, and future growth is fully justified.