Green light Dutch banks to start paying dividends again soon | Financial

The European Central Bank (ECB) announced that it will not extend the corona measure that temporarily banned the payment of dividends and the purchase of own shares. However, banks still have to have their plans approved as “part of normal supervision.” The ECB also calls on banks to remain cautious.

De Nederlandsche Bank (DNB) has announced that it will follow the ECB’s step. As a Dutch watchdog, DNB supervises smaller banks and financial institutions.

Earlier, the central banks in the United States and the United Kingdom also decided to scrap similar rules. Central banks wanted banks to hold extra money as a buffer to cushion the possibility that many companies would not be able to repay their loans due to the corona crisis. However, this turned out to be not so bad, partly due to ample support from governments.

In the United States, banks were already able to release substantial amounts that they had previously set aside to absorb bad loans. That propelled profits and banks immediately paid out part of it to their shareholders.

–