The Bank of Ghana, or BOG, issued a notice (BG/GOV/SEC/2020/03) directed to all banks and specialized deposit-taking institutions to desist them from declaring or paying dividends or distributing reserves to shareholders. As per the direction in the notice, banks and specialized deposit-taking institutions shall have to seek prior written approval from BOG before declaring or paying dividends or distributing reserves to shareholders and before making any irrevocable commitments regarding the declaration or payment of dividends to shareholders.
The criteria to be satisfied for declaration or payment of dividends are:
- Compliance with Sections 34 and 35 and all other relevant provisions of the Banks and Specialized Deposit-Taking Institutions Act, 2016 (Act 930)
- Compliance with the Capital Adequacy Ratio of 13%, Cash Reserve Ratio of 10%, and Non-Performing Loans (NPL) ratio of below industry average at all times
- Compliance with Section 72 as well as all other relevant provisions on dividend payments, as prescribed under the Companies Act, 2019 (Act 992)
- Submission of Audited Financial Statements to BOG
- No existing operational restrictions from BOG by way of Prompt Corrective Actions as per Act 930
- Stress test results showing the ability of bank to maintain sufficient capital buffers after dividend payment
Related Link: Notice
Keywords: Middle East and Africa, Ghana, Banking, Dividend Distribution, Stress Testing, Regulatory Capital, BOG
Previous ArticleACPR Makes Available COREP Sub-consolidated Taxonomy 188.8.131.52
Next ArticleBundesbank Publishes Reporting Updates in April 2021
The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.
The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).
The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0.
The Hong Kong Monetary Authority (HKMA) published a circular, along with the reporting form and instructions, for self-assessment, by authorized institutions, of compliance with the Code of Banking Practice 2021.
The Financial Conduct Authority (FCA) decided to register European DataWarehouse Ltd and SecRep Limited as securitization repositories under the UK Securitization Regulation, with effect from January 17, 2022.
The European Commission (EC) published the Delegated Regulation 2022/25, which supplements the Investment Firms Regulation (IFR or Regulation 2019/2033) with respect to the regulatory technical standards specifying the methods for measuring the K-factors referred to in Article 15 of the IFR.
The Bank of International Settlements (BIS) published a paper that assesses the ways in which platform-based business models can affect financial inclusion, competition, financial stability and consumer protection.
The Central Bank of Egypt (CBE) published a circular with instructions on emergency liquidity assistance to banks that are unable to meet their liquidity requirements.
The European Supervisory Authorities (ESAs) published the list of identified financial conglomerates for 2021.
The Australian Prudential Regulation Authority (APRA) updated the list of authorized deposit-taking institutions, granting license to Barclays Bank PLC and Crédit Agricole Corporate and Investment Bank to operate as foreign authorized deposit-taking institutions under the Banking Act 1959.