DNB ASA logo

DNB - DNB ASA News Story

NOK181.25 -0.8  -0.4%

Last Trade - 05/05/21

Sector
Financials
Size
Large Cap
Market Cap £24.30bn
Enterprise Value £56.17bn
Revenue £5.01bn
Position in Universe 30th / 1831

UPDATE 1-Norway's banks should not be allowed to pay dividends for now, regulator says

Wed 25th March, 2020 11:37am
(Adds reaction from ministry, industry lobby, background)
    By Terje Solsvik and Gwladys Fouche
    OSLO, March 25 (Reuters) - Norwegian banks and insurers
should not be allowed to pay dividends for now given the grave
consequences they face from the coronavirus outbreak, Norway's
Financial Supervisory Authority proposed to the finance ministry
on Wednesday.
    Banks could face significant losses due to the outbreak,
while insurers risk lower income due to a fall in interest rates
and could also see a drop in asset values, the FSA said.
    A decision on whether to allow dividend payments to be made
for the 2019 fiscal year will be made "as soon as possible", a
finance ministry spokesman told Reuters.
    The financial industry's lobby said the ministry should
reject the proposal. 
    "Creating uncertainty among those who make capital available
to Norwegian banks and insurance companies now is very
unfortunate," Finance Norway said in a statement.
    Most banks have proposed payments for 2019 and are due to
hold shareholder meetings in coming weeks to approve the plans.
    Already on March 16 the regulator had urged banks to
reconsider dividend payments and buybacks.  urn:newsml:reuters.com:*:nL8N2B928F 
    Norway's private-sector activity is expected to contract by
between 15% and 20% in the near term, the government has
predicted, and unemployment has risen fivefold in recent weeks
to its highest level since the 1930s. urn:newsml:reuters.com:*:nL8N2BH5MT
    Norway's largest bank, DNB  DNB.OL , said on Monday it was
still considering whether to maintain its plan of paying out a
dividend at its annual general meeting at the end of April.
    Insurer Gjensidige  GJFS.OL  dropped on Monday a proposal to
distribute an extraordinary dividend of 5 Norwegian crowns per
share, but maintained plans for paying out an ordinary dividend
of 7.25 crowns.
    The regulator said any ban on dividends could be reversed at
a later time if circumstances change.

 (Editing by Andrew Heavens and Alexandra Hudson)
 ((terje.solsvik@thomsonreuters.com; +47 918 666 70; Reuters
Messaging: terje.solsvik.thomsonreuters.com@reuters.net))
© Stockopedia 2021, Refinitiv, Share Data Services.
This site cannot substitute for professional investment advice or independent factual verification. To use it, you must accept our Terms of Use, Privacy and Disclaimer policies.