2021 Bank interim and final cash dividends are temporarily halted by the CBSL .

The Central Bank of Sri Lanka's (CBSL) Monetary Board has placed temporary limits on the declaration and payment of interim and full dividends for 2021 until financial accounts have been finalized and audited by external auditors.

 

The Monetary Board has announced these and numerous other restrictions on discretionary payments, which will take effect on July 1, 2021.

 

It said the new directives were put in place after considering the potential impact of the COVID-19 outbreak on liquidity and other key performance indicators of licensed commercial and specialized banks, as well as the importance of maintaining adequate liquidity and capital buffers in licensed banks.

 

Until the financial accounts/interim financial statements for 2021 are finalized and certified by its external auditor, any licensed commercial bank incorporated outside Sri Lanka should refrain from repatriating income not already declared for the financial years 2020 and 2021.

 

When deciding on cash dividends and profit repatriation, licensed banks should take into account the requirements of the Banking Act Directions No. 01 of 2016 on Capital Requirements under Basel III for Licensed Banks, expected asset growth, business expansion, and the potential impact of the COVID-19 pandemic, as well as current market conditions.

 

These limits had previously been extended until June 30, and the latest regulation affirms that they would continue and be extended until December.

 

The Monetary Board asked banks to suspend the payment of cash dividends until the financial year statements for 2020 are finalized and audited in January of this year. Following that, a number of banks declared cash and scrip dividends that were subject to approval.

 

Source: ft.lk