rtmark
LearnBonds.com

UK bank stocks fall on fresh calls to cancel dividends

Bank of England governor Andrew Bailey (pictured) has come under fresh pressure to halt British banks paying out over £7.5bn of dividends over the next few weeks and use the cash to support the UK economy hit by the coronavirus pandemic.

Agustín Carstens, head of the Bank for International Settlements — known as the central bank for central banks — called for a global freeze on dividends in the sector.

Carstens, writing for the Financial Times, said that “banks should be part of the solution” during the coronavirus crisis and “not part of the problem”.

He added: “Now is the time to draw on the accumulated balance sheet buffers that were built while the sun was shining.

 

Regulators call on banks to halt billions of investor payouts

“To boost lending capacity further, we need a global freeze on bank dividends and share buybacks.”

Shares in Barclays fell 4 per cent in Monday morning trading, HSBC dropped 4 per cent, Lloyds Bank dipped just under three per cent and Royal Bank of Scotland eased just under two per cent.

This follows a call on Friday from the European Central Bank (ECB), which told eurozone lenders to skip dividend payments and share buybacks until at least October and use profits to lend to firms and individuals impacted by the virus.

The ECB said: “To boost banks’ capacity to absorb losses and support lending to households, small businesses and corporates during the coronavirus (COVID-19) pandemic, they should not pay dividends for the financial years 2019 and 2020 until at least 1 October 2020,” the ECB said in a statement.

 

Banks under pressure to lend during the health emergency

“Banks should also refrain from share buy-backs aimed at remunerating shareholders.”

The move puts the largest banks in Britain and across Europe under pressure to cancel or delay plans to return billions to investors. Across the eurozone, this payout could amount to €30bn, said Andrea Enria, chair of the ECB’s supervisory board.

“As everything around us is being put on hold to focus all the efforts of our communities on the fight against the coronavirus, a contribution is also required from banks and their shareholders,” said Mr Enria in a blog post.

Trusted & Regulated Stock & CFD Brokers

Rating

What we like

  • 0% Fees on Stocks
  • 5000+ Stocks, ETFs and other Markets
  • Accepts Paypal Deposits

Min Deposit

$200

Charge per Trade

Zero Commission

Rating

64 traders signed up today

Visit Now

75% of investors lose money when trading CFDs.

Available Assets

  • Total Number of Stocks & Shares5000+
  • US Stocks
  • German Stocks
  • UK Stocks
  • European
  • ETF Stocks
  • IPO
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 Zero Commission
  • NASDAQ Zero Commission
  • DAX Zero Commission
  • Facebook Zero Commission
  • Alphabet Zero Commission
  • Tesla Zero Commission
  • Apple Zero Commission
  • Microsoft Zero Commission

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
  • Paypall
  • Skrill
  • Neteller

Rating

What we like

  • Sign up today and get $5 free
  • Fractals Available
  • Paypal Available

Min Deposit

$0

Charge per Trade

$1 to $9 PCM

Rating

Visit Now

Investing in financial markets carries risk, you have the potential to lose your total investment.

Available Assets

  • Total Number of Shares999
  • US Stocks
  • German Stocks
  • UK Stocks
  • European Stocks
  • EFTs
  • IPOs
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 $1 - $9 per month
  • NASDAQ $1 - $9 per month
  • DAX $1 - $9 per month
  • Facebook $1 - $9 per month
  • Alphabet $1 - $9 per month
  • Telsa $1 - $9 per month
  • Apple $1 - $9 per month
  • Microsoft $1 - $9 per month

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
Users should remember that all trading carries risks and users should only invest in regulated firms. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
Roger Baird

Roger Baird is News Editor at Finixio. He has worked as a financial journalist for 20 years reporting on companies, capital markets and the UK economy.