Manage Their Returns To Shareholders Actively

Share buy back programs provided huge returns to the shareholders. With just 11 as capital component, the company bought back shares at 27.50 providing them with huge benefits. Dividend reinvestment plan helps the shareholder to get high capital gains in future. In May 2004, CBA announced a share purchase plan under which shareholders couldapply for shares at 31.36. Assuming the share price is higher than 31.36, the company is providing the shares at a discount and hence a benefit to the shareholders. What are the reasons that such actions are taken, and what is the impact of these actions on this companys financial structures and business Are these actions unique in the market The actions are not unique since most of the companies would be doing the same. The effect is the increased participation and liquidity in the shares of the company. With increased participation, share price will rise and hence the company would be able to issue more shares and bonds in future. Higher payout policy means stock price will using (Dividend discount model). The company would be able to get finance easily with more shares and trust on the company. Y, dXiJ(x( I_TS 1EZBmU/xYy5g/GMGeD3Vqq8K)fw9 xrxwrTZaGy8IjbRcXI u3KGnD1NIBs RuKV.ELM2fi V