Fed asks big U.S. banks to halt dividend payments and share repurchases until end of September
The US Federal Reserve has told the US’s biggest banks they will not be able to raise their dividends until at least the end of the third quarter and resume share repurchases due to uncertainty over the effects of the global pandemic on banks.
The banking sector has done well in annual stress tests, but another report examining the effects of coronavirus on the economy and financial system has exposed potential risks that pose a question mark for banks ‘ dividends, the Fed said.
“The Fed is taking action to assess the conditions of the banks more intensively and to ensure that the largest banks take cautious measures to protect their capital in the coming months,” said Randall Quarles, the Fed’s Vice President of supervision, in a statement. “the banking system remains well capitalized even in the most difficult of these downward scenarios.”
The Fed limited the banks ‘ dividends to levels in the second quarter and said future payments would be limited by a formula based on recent profits.
Most of that step is Wells Fargo & Co, whose profit fell 89 percent in the first quarter of the year on a dividend cut. it’s a risk to you. The San Francisco-based bank’s profit strength has waned with the economic meltdown, and unlike its other rivals, Wells Fargo does not have significant trading operating income that benefits from market volatility. Under the new rule, the bank’s dividend will not exceed the quarterly profit average of the previous four quarters.
But there is still a chance that Wells Fargo will continue to distribute dividends. Assuming the bank’s second-quarter profit is as low as its level in the first quarter of the year, the average for the past four quarters will be $ 2.2 billion, which is above the $ 2.1 billion dividend the bank paid in the first quarter.
7 comments
Hola! I’ve been reading your blog for a while now and finally got the courage to go ahead and give you a shout out from Huffman Tx!
Just wanted to mention keep up the fantastic
job! These are truly enormous ideas in regarding blogging.
You have touched some nice things here. Any way keep up wrinting.
I am sure this paragraph has touched all the internet visitors, its really really good article on building up
new weblog.
Fed İmposed Limits On Banks ‘ Dividends and Share Repurchases fed meeting calendar 2021 and european central bank meetings 2021 calendar so important
Fed İmposed Limits On Banks ‘ Dividends and Share Repurchases 2021 2022 fed meetings calendar
snb bank of england and bank of japan fed ecb metting 2021 2022
Fed İmposed Limits On Banks ‘ Dividends and Share Repurchases meeting dates 2021 2022 euro note ecb 1000 2000
Wonderful article! That is the type of info that are meant to be shared around
the net. Fed İmposed Limits On Banks ‘ Dividends and Share Repurchases. Shame on Google for now not positioning this submit higher! ECB meeting date 2021 2022 fed euro note 500 1000 2000
Your style is so unique in comparison to other folks I’ve read stuff from.
Thank you for posting when you’ve got the opportunity, Guess I will just book mark this site.