According to the central bank, the lenders will be able to resume payments once their adequate capitalisation has been verified. The Bank of England urges prudence regarding the return of dividends and will maintain some requirements. These include not exceeding 25% of the profits of the last eight quarters, or 0.2% of their risk-weighted assets. Everything points to the ECB lifting its veto on dividends tomorrow.
Santander Corporate & Investment | The ECB published on Tuesday the aggregate results of its vulnerability analysis of the 86 banks directly supervised under the Single Supervisory Mechanism. This shows that “the euro area banking sector can withstand the stress induced by the pandemic but, if the situation worsens, the decline in bank capital would be significant. Furthermore, the ECB has extended its recommendation that banks should not distribute dividends until 2021.