Regulatory Alerts2021-02-18
G3 - 2021 Distribution of dividends on ordinary shares and payment of cash bonuses to executive officers
The Prudential Authority issued Guidance Note 3/2021 to direct banks to conserve capital and act prudently regarding dividend distributions and executive bonus payments during the ongoing COVID-19 pandemic. The regulator explicitly states that temporary regulatory relief measures provided in 2020 must not be utilized to fund these distributions or payments in 2021. Banks are required to ensure that any approved payouts are commensurate with their current capital adequacy, risk appetite, and the uncertain economic outlook.
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