A Study on the Dividend Policy of Private Commercial Banks in Bangladesh

Abstract

The paper attempts to study dividend policy and size of all 30 Dhaka Stock Exchange listed private commercial banks in Bangladesh during January 2006 - December 2013. Annual total assets of bank is employed as measurement of its size. Statistical analyses, applying tools as correlation and regression, indicate a negative correlation between size of commercial banks and their respective dividend policy in 2006 and 2007, but it turns positive from 2008 onwards. The paper, however, shows that dividend policy changes in banks cannot be adequately explained by variations in their respective size over the period of study. The size of a private commercial bank, therefore, may not be a prime indicator of its dividend policy in the capital market of Bangladesh.