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Banco Macro: A 21% Dividend Is Coming But There Is A Catch

Apr. 05, 2021 1:59 PM ETBanco Macro S.A. (BMA)MERVAL22 Comments


  • Banco Macro is one of the largest banks in Argentina.
  • A dividend of ARS 16,580 million has already been approved and an additional ARS 10,000 million are to be approved next month.
  • Altogether, this ARS 26,580 million represents a 21.1% dividend yield at current prices.
  • Here is the catch: Argentina's Central Bank currently does not allow financial institutions to distribute dividends. But this temporary restriction must end sometime.
  • We will be focusing mainly on the pending dividends and understanding the Central Bank's current restrictions. Also, I will be giving you some context to today's market situation in Argentina.


Banco Macro (NYSE:BMA) is one of the largest banks in Argentina and is currently trading at - what I think are - attractive prices, after plummeting 90% in the last three years during one of the longest and harshest bear markets in record.

Last year, the annual shareholders' meeting considered 2019's results and approved a dividend of ARS 12,780 million. The payment was kept on hold due to current restrictions from the Central Bank of Argentina (BCRA) that temporarily does not allow financial institutions to distribute dividends for reasons we will be explaining in detail later. This figure was later increased to ARS 16,580 million to account for inflation.

Next month, the annual shareholders' meeting is considering to approve a new ARS 10,000 million dividend that would add up to the already approved ARS 16,580 million, totaling ARS 26,580 million which in turn represents a 21.1% return at current prices.

Restrictions from the Central Bank holding back the payment of this dividend cannot last forever. In this article, we will be mainly focusing on the dividends itself and understanding BCRA's restrictions and how long can they last. We will not be valuing the company. However, we will be contemplating current prices through technical analysis for some market context specially aimed to foreign investors.

Banco Macro HeadquartersBanco Macro Headquarters. Source: Pelli Clarke Pelli Architects.

A Quick Technical Overview

Let me start by giving you some context. Banco Macro has plummeted more than 90% from the 2017's all-time highs, returning to the same lows of the 2012 crisis.

Banco Macro Technical OverviewSource: author, using tradingview.com

This behavior is not restricted only to BMA, but it is instead the norm for almost all argentine equity. Here you can see a 25-year-long graph of the Merval Index (MERVAL) in USD, adjusted by inflation. Average historical price is shown in

This article was written by

Full-time investor for the last seven years. Professional Investor Advisor specialized in Argentina's stock market. Energy & Real Estate with a long-term horizon. Dividend investing. Co-founder of Club Argentino de Inversores, largest investor community in Argentina with over 50.000 members.

Analyst’s Disclosure: I am/we are long BMA, PAM, IRCP. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (22)

Did BMA pay out the dividends or do a buy back? Been over a year since this article. Would be interesting to find out.
Luis Manuel Sandberg Haedo profile picture
@AdNeMa Yes. BMA is distributing dividends again, after receiving approval from the Central Bank. It has distributed USD 0.79 per ADR in the last two months and will pay USD 0.32 more in four installments until the year end. But the company still has tons of dividends already approved to be paid to shareholders, awaiting Central Bank's approval. My guess is next year will be a great one for dividends.
whitehead1 profile picture
Nice breakout in BMA, GGAL today, still room to go up in near future
whitehead1 profile picture
BMA ready to break out of 52 wk range. Has been the best performer in my portfolio in last couple of weeks. Still undervalued.
@Luis Manuel Sandberg Haedo Could you update with your latest thoughts?
@RGsanfran I'm almost thinking to grab it, if it hits my target around $13, and wait out the rest of the year. Consider it dead money until there is a catalyst. At least technically it appears to be finding a base.
whitehead1 profile picture
don't think, just grab it.
Luis Manuel, anything new to add to this article as June 30th is fast approaching? Was there an extension to the dividend restrictions?
Luis Manuel Sandberg Haedo profile picture
@Drvenikmerlot Yes, two days ago Central Bank extended the restriction until December 31st through communication A7312: www.bcra.gov.ar/...
whitehead1 profile picture
Sometimes stocks trade so cheaply that you start to doubt your self. I own BMA and may buy more. One of my last year best buy was DAC which was trading at .5 P/E in 2020 and now trades over 60.
vohryzek profile picture
Thanks for your article! Which sectors do you believe are the safest to invest in Argentina today?
juangoicoa profile picture
@vohryzek $VIST is the best argentinian company without any doubt.
vohryzek profile picture
@juangoicoa Many thanks for your reply! I will study the company. Should we be afraid of an expropriation or other interference by the present government?
juangoicoa profile picture
@vohryzek not really, the CEO of Vista was selected as the first CEO of YPF when it was expropiated by the government in 2012, and de gov is ecouraging oil exports
BMA have huge upside, they are NOT going out of business any time soon.
Long BMA
Luis, excellent report.
Don't you think there could be a share buyback program at the next Shareholders' Meeting? In this way, it would not be dependent on the BCRA.

Another point that I would like to clarify with you is about the origin of the bank's profits. Do you have the information on whether it is financial intermediation with private parties or the result of holding nacional bonds?
Don't you think that the possibility of forced exchanging LELIQs and other securities in pesos for some illiquid bond could happen? Historically we live, the BONEX Plan and the delivery of "préstamos garantizados" (post 2001 and like compensation of asimetric devauations).

Last point to enrich your excellent analysis. In case of approval of dividends and payment to ADRs, I consider that it could be in USD Argy Bonds (ie: GD30) and there would have a dividend differential of 40% due to the exchange gap (USD CCL).

Thanks a lot por your apreciations.
juangoicoa profile picture
@mruizfuentes there’s no way that they can pay dividends. Maybe a buyback.
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