Featured Product

    SARB Issues Guidance on Dividend Distributions and Bonus Payments

    February 18, 2021

    SARB published the guidance note (3/2021) on the distribution of dividends on ordinary shares and payment of cash bonuses to executive officers and material risk-takers, in light of the pandemic and the temporary regulatory capital relief provided by the Prudential Authority. The guidance note outlines the need for banks to act prudently when considering making the said distributions in 2021. This guidance note replaces the guidance note 4 from 2020 and is relevant for all banks, branches of foreign institutions, controlling companies, eligible institutions, and auditors of banks or controlling companies.

    The note specifies that benefits of the regulatory relief measures provided by the Prudential Authority in 2020 should not be utilized for the distribution of dividends and payment of bonuses. on dividends and bonus payments in response to COVID-19. SARB considers it critical that banks continue to fulfil the fundamental role of providing the required funding, among other things, to households and businesses amid the pandemic. Thus, it is essential that banks continue to appropriately conserve capital to retain their capacity to support the real economy in an environment of heightened uncertainty that continues to be caused by COVID-19 pandemic. The Prudential Authority expects banks to take into consideration the adequacy of their current and projected capital and profitability levels, internal capital targets, risk appetite, and current and potential future risks of the global pandemic when making distributions of dividends on ordinary shares and payments of cash bonuses to executive officers and material risk-takers in 2021. The responsibility for approving the distribution of dividends on ordinary shares and the payments of cash bonuses to executive officers and material risk-takers ultimately rests with the board of directors of a bank. In those instances where bank boards of directors do approve the distributions of dividends on ordinary shares and/or payments of cash bonuses to executive officers and material risk-takers in 2021, payout ratios should be prudent and commensurate with the assessment of the current conditions and potential future uncertainty.

     

    Related Links

    Keywords: Middle East and Africa, South Africa, Banking, Dividend Distribution, COVID-19, Remuneration, Regulatory Capital, SARB

    Featured Experts
    Related Articles
    News

    ECB Further Reviews Costs and Benefits Associated with IReF

    The European Central Bank (ECB) is undertaking the integrated reporting framework (IReF) project to integrate statistical requirements for banks into a standardized reporting framework that would be applicable across the euro area and adopted by authorities in other EU member states.

    September 15, 2022 WebPage Regulatory News
    News

    BCBS to Finalize Crypto Rules by End-2022; US to Propose Basel 3 Rules

    The Basel Committee on Banking Supervision met, shortly after a gathering of the Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of BCBS.

    September 15, 2022 WebPage Regulatory News
    News

    IOSCO Welcomes Work on Sustainability-Related Corporate Reporting

    The International Organization of Securities Commissions (IOSCO) welcomed the work of the international audit and assurance standard setters—the International Auditing and Assurance Standards Board (IAASB)

    September 15, 2022 WebPage Regulatory News
    News

    EBA Publishes Funding Plans Report, Receives EMAS Certification

    The European Banking Authority (EBA) has been awarded the top European Standard for its environmental performance under the European Eco-Management and Audit Scheme (EMAS).

    September 15, 2022 WebPage Regulatory News
    News

    BoE Allows One-Day Delay in Statistical Data Submissions by Banks

    The Bank of England (BoE) published a Statistical Notice (2022/18), which informs that due to the Bank Holiday granted for Her Majesty Queen Elizabeth II’s State Funeral on Monday September 19, 2022.

    September 14, 2022 WebPage Regulatory News
    News

    ACPR Amends Reporting Module Timelines Under EBA Framework 3.2

    The French Prudential Control and Resolution Authority (ACPR) announced that the European Banking Authority (EBA) has updated its filing rules and the implementation dates for certain modules of the EBA reporting framework 3.2.

    September 14, 2022 WebPage Regulatory News
    News

    APRA to Modernize Prudential Architecture, Reduces Liquidity Facility

    The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility (CLF) for authorized deposit-taking entities to ~USD 33 billion on September 01, 2022.

    September 12, 2022 WebPage Regulatory News
    News

    PBC Issues List of Systemic Banks, Adds 2 Foreign Banks to CERB List

    The China Banking and Insurance Regulatory Commission (CBIRC) published the administrative measures for internal control of wealth management companies, which come into force on the day of promulgation.

    September 09, 2022 WebPage Regulatory News
    News

    PRA Publishes Discussion Paper on Its Future Approach to Policy

    The Prudential Regulation Authority (PRA) proposed its approach to policy-making as it takes on wider rulemaking responsibilities under the Financial Services and Markets Bill.

    September 08, 2022 WebPage Regulatory News
    News

    ECB Publishes Opinion on Proposed Regulation on Data Act

    The European Central Bank (ECB) published its opinion on the proposal for a regulation on harmonized rules on fair access to and use of data (Data Act).

    September 08, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8511