BoG Freezes Dividends For 2019

The Bank of Ghana (BoG) has directed banks and Specialized Deposit-Taking Institutions (SDIs) to stop declaring and paying dividends and from making other distributions to shareholders for the 2019 financial year.

It says such distributions can be made unless the Bank of Ghana was satisfied, that such institutions met the regular prudential requirements and were not relying on the additional liquidity released by the regulatory reliefs provided by the Bank of Ghana.

BoG in a statement signed by its Secretary, Sandra Thompson, indicated that it would continue to monitor the evolving impact of the pandemic on banks and SDIs and on their customers, and would issue further directives as required.

“In furtherance of the above, and to ensure that banks and SDIs are better able to support their customers throughout the COVID-19 pandemic, to absorb any potential operational losses for banks and SDIs from the COVID-19 pandemic, the Bank of Ghana now directs that all banks and SDIs desist from declaring and/or paying any dividends or distributing reserves to shareholders, and from making any irrevocable commitments regarding the declaration or payment of dividends to shareholders, until further notice,” it says.

“For the avoidance of doubt, shareholders in this context means holders of Common Equity Shares (CET1) and Additional Tier I (AT1) capital instruments of banks and SDIs.”

“All Banks and SDIs are to take note of the above directive for immediate compliance,” the statement dated April 20, 2020 says.

---Daily Guide