Questions are building about whether big U.S. banks will have to cut dividends later this year as the coronavirus crisis puts a record portion of ...
Questions are building about whether big U.S. banks will have to cut dividends later this year as the coronavirus crisis puts a record portion of Americans out of work, making it difficult for borrowers to pay back loans.
Those lenders, including Citigroup Inc , JPMorgan Chase & Co and Capital One Financial Corp , may breach Federal Reserve limits on using capital for dividends when loan losses escalate and erode profits. On balance, however,"all of the banks should be in a position to maintain dividends at, or close to, the current run rate," he said.Dividends are seen as evidence of good financial health and encourage loyalty from investors who expect that income, which makes companies leery of cutting them.
The European Central Bank told their lenders on March 27 to skip dividends and share buybacks until at least October, estimating they could save 30 billion euros by doing so. "Our dividend is sound," Citigroup Chief Executive Mike Corbat told CNBC on Wednesday."We plan on continuing to pay it."
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