Similar measures were adopted central banks Europe, Sweden, Australia, Canada, Brazil, Russia, India and south Africa, among others.
One of the first cases was that of the European Central bank (ECB)led by the former governor of the IMF, Christine Lagarde, when at the end of march he asked to the banks of the “old continent” that do not distribute dividends outstanding, 2019, and 2020 to October 1, while extending the negative effects of the pandemic.
On that occasion, the monetary authority european recalled that in mid-march took measures of temporary relief, so that the financial entities have more flexibility in booking your own funds, or to manage the credit risk. The goal was to ensure the support of the sputtering economy.
“Now is the time that the shareholders of the banks to join in this collective effort”explained the entity in a press release.
The ECB stated that the financial institutions must continue “funding the homes, the small companies and the big companies” and clarified that, by not distributing dividends, may also to absorb the losses that generate some of these subprime loans.
Last month, Andrea Enria, chairman of the Supervisory Board of the ECB, said he expected the banks to retain as capital in their balance sheets more than 27,000 million euros of 35,000 million that they planned to distribute in dividends to their shareholders.
The proposals will be submitted to a vote by the european committee next Monday, to spend the day 14 to its approval by the plenary.