Nedbank to pay declared dividend in April
The Reserve Bank on Monday asked banks to reconsider dividend payments in 2020 in order to shore up their balance sheets due to Covid-19
Nedbank said on Wednesday it will proceed with paying shareholders about R3.5bn in dividends on April 20, although it is supportive of the Reserve Bank’s guidance that banks hold on to distributions to shore up their balance sheets.
On Monday, the central bank’s supervision division, the Prudential Authority, issued a nonbinding recommendation for banks to consider suspending dividends and putting bonuses to senior managers on hold as SA grapples with the Covid-19 pandemic.
Nedbank said on Wednesday it would pay its R6.95 per share dividend, noting recent comments from the Reserve Bank regarding dividends that had already been declared, and the legal implications of not paying a declared dividend.
“Future dividend declarations and related distributions will be impacted for so long as the guidance note is applicable,” the group said in a statement. “Management and the board are consulting their advisers and monitoring evolving developments in this regard and will make further announcements as necessary.”
Absa is due to pay 620c per share in final dividends, translating into just more than R5.3bn in payouts to shareholders later in April. The company said it would take the Prudential Authority’s guidelines into consideration in the 2020 fiscal year.
Standard Bank, which is due to pay ordinary shareholders about R8.6bn in dividends this month, said it is considering the recommendation.