(Yicai Global) Aug. 1 -- Some 1,409 of the Shenzhen Stock Exchange's 2,170 listed companies paid dividends in the first half, amassing a total of nearly CNY248 billion (USD36 billion) as the bourse encouraged firms to disburse more cash to shareholders.

The figure was up 21 percent from the first six months of 2018, the 21st Century Business Herald reported yesterday. Just 20 percent of the 1,409 firms made up 74 percent of the dividends paid out this year, or CNY184 billion.

It is beneficial for listed companies to share risks and returns with employees and other shareholders, the report cited market analysts as saying. This also conveys positive expectations for future development to employees and can enhance investor confidence and therefore market vitality, they added.

The Shenzhen bourse has brought in several measures to promote dividend payouts and share buybacks in line with firms' articles of association since September, and has also raised concerns about actions that appear to exploit payouts and repurchases to jack up share prices and optimized incentives systems to factor this in during companies' credit assessments.

Electrical machinery and equipment makers and computer-related firms were the biggest dividend payers, both of which have ranked among the top five for many years, the report added.

Share Buybacks

The higher dividend payouts have come on the back of a surge in companies buying back their own shares. Some 408 companies listed in Shenzhen reported 446 planned repurchases from January 2018 through June 2019, involving a total CNY146.3 billion. They had bought back some CNY53.2 billion by May -- nearly eight times as much as were repurchased through 2017, when 28 companies bought CNY6.8 billion (USD) of their own shares.

Some 285 of the 408 are also paying dividends.

Private companies made up nearly 90 percent of those buying back shares, particularly on Shenzhen's small- to mid-size enterprise and growth boards. Most repurchases were to develop employee stock ownership plans and offer equity incentives.

Editor: James Boynton