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ECB Urges Banks to Pause Shareholder Payouts for Longer

  • Will review stance on dividends, buybacks in fourth quarter
  • ECB wont seek capital buffer replenishment until end of 2022
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ECB Urges Banks to Pause Shareholder Payouts for Longer
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The European Central Bank extended a de facto ban on banks returning capital to shareholders and urged them to show restraint on bonuses after the coronavirus outbreak, dealing a blow to lenders who lobbied for business as usual.

The supervisor asked that banks not pay dividends or buy back shares at least until January, three months longer than initially indicated, and “to be extremely moderate with regard to variable remuneration,” according to a statement Tuesday. The ECB said it will review its stance again in the fourth quarter.