Banks should have some leeway to distributions to shareholders

  • BOE says that PRA (Prudential Regulation Authority) judges that extension of the exceptional and precautionary action taken in March is not necessary and that there is scope for banks to recompense some distributions
  • Any distributions should be prudent, reflecting the still elevated levels of economic uncertainty
  • PRA says extension of exception and precautionary action on bank distributions taken in March not necessary
  • BOE says PRA therefore asks boards, when making their decisions for 2020 distributions, to operate within a framework of temporary guardrails
  • PRA says any distributions should be prudent, reflecting the still elevated levels of economic uncertainty
  • Distributions to ordinary shareholders by large UK banks should not exceed the higher of 20 basis points of risk-weighted assets as an end of 2020 or 25% of cumulative 8/4 profits covering 2019 and 2020
  • PRA says thanks remain well-capitalized, able to support economy