Banks & deposit-taking institutions to suspend dividends
SAGICOR GROUP Jamaica yesterday announced the postponement of its previously declared interim dividend payment of 40 cents per stock unit, following a recommendation from the Bank of Jamaica to all Financial Holding Companies.
“We sincerely regret the short-term impact this will have on shareholders. However, our decision is aligned with our regulator’s wishes and represents our commitment to Jamaica and the financial sector in light of the global COVID19 pandemic,” said Peter Melhado, chairman of Sagicor Group Jamaica.
This comes in the wake of an announcement by the central bank that deposit-taking institutions have been asked to suspend the distribution of profits by way of declaring dividends in any manner (cash or stock) for the 2020 financial year until further notice.
DECLARED DIVIDENDS POSTPONED
In addition, institutions will similarly postpone the distribution of any unpaid dividends declared for the 2019 financial year.
The BOJ says the action, based on consultation, came in view of conserving capital and further enhancing licensees’ lending and loss absorption capacities.
Noting that it has been closely monitoring the impact of COVID-19 on the global and domestic financial system, the BOJ says the fundamentals of the Jamaican financial system continue to be strong with licensees’ capital and liquidity exceeding current regulatory requirements and established prudential norms.
In addition, the central bank says it stands ready to provide liquidity and other support necessary to ensure that financial institutions can continue to provide credit and other financial services to the public, limit the potential negative economic repercussions on the lives of ordinary Jamaicans and preserve confidence in the Jamaican financial system.