Latvian banks have limited the payment of dividends during the pandemic Covid-19

The representative of the Commission on Finance and Capital Markets (FKTK) Dace Jansone said that the agency, in accordance with the recommendation of the European Central Bank (ECB), expects to refuse to pay dividends and revise the policy in this regard from the supervisory department of commercial banks of Latvia, writes the portal LSM. FKTK believes that the refusal to pay dividends will help banks to compensate for possible losses from the economic crisis caused by the Covid-19 pandemic, as well as maintain their ability to continue lending. In fact, FKTK broadcasts the ECB's March 27 recommendation to supervised commercial banks to limit dividend payments during the Covid-19 pandemic. The document says not to assume obligations on dividend payments for 2019 and 2020, as well as to refrain from share buyback transactions in favor of owners. Banks that do not agree with the recommendation, which consider the payment of dividends legally mandatory, should immediately provide FKTK with explanations of such actions. The ECB may decide to extend or terminate the dividend moratorium after October 1, 2020.