Banks, SDI’s granted extension to suspend dividend payment to shareholders - BoG

The central bank says it has granted an extension to banks and Specialised Deposit-Taking Institutions on its directive to suspend dividend payment to shareholders.

According to a statement issued by the Bank of Ghana on April 12 2021, the initial directive was due to some uncertainties with regards to the coronavirus pandemic and its associated impact on the financial sector.

“Banks and SDIs shall seek prior written approval from the Bank of Ghana before declaring or paying dividends or distributing reserves to shareholders, and making any irrevocable commitments regarding the declaration or payment of dividends to shareholders,” the statement explained.

The Bank of Ghana further added that approval would be granted to licensed Banks and SDI’s that meet the intended criteria.

These include; compliance with the capital adequacy ratio of 13%, cash reserve ratio of 10%, and a non-performing loans (NPL) ratio below the industry average at all times.

“The measures taken by the Bank of Ghana during the pandemic have ensured that the banking sector has generally remained robust and resilient. However, the Bank of Ghana shall continue to monitor developments in the industry to identify emerging risk and potential threats to the safety and soundness of the banking sector and shall issue further notices as may be required,” the statement concluded.

Read the statement below: