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FINANCIAL CHRONICLE™ » CORPORATE CHRONICLE™ » Sri Lanka halts dividends, profit repatriation, share buy backs by banks

Sri Lanka halts dividends, profit repatriation, share buy backs by banks

+4
Junior investor
cseguide
Quibit
ChooBoy
8 posters

Go down  Message [Page 1 of 1]

ChooBoy


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

Sri Lanka halts dividends, profit repatriation, share buy backs by banks.

ECONOMYNEXT – Sri Lanka’s central bank ]has halted banks from declaring dividends and foreign banks from repatriating profits under new regulations which it said was to conserve liquidity amid a Coronavirus outbreak until December 2020.[/size]
“Licensed banks incorporated or established iu Sri Lanka shall refrain from declaring cash dividends not already declared for financial year 2019 and any interim cash dividends for financial year 2020,” the central bank said in a direction.

“Licensed commercial banks incorporated outside Sri Lanka shall refrain from repatriation of profits not already declared for financial years 2019 and 2020.”
Share buybacks have also been banned.
Wage or allowances to management or directors have also been banned.[/size]

The central bank has injected unprecedented volumes of money in to the banking system from late February before private credit fell, leading to a loss of credibility in the currency and downgrades. 
The full statement is reproduced below:
3.4 Licensed banks shall refrain from increasing management allowances and payments to Board of Directors.
“3.5 Licensed banks shall exercise prudence and refrain to the extent possible from incurring non-essential expenditure such as advertising, business promotions, sponsorships, travelling and training. etc…”

3.6 Licensed banks shall exercise extreme due diligence and prudence when incurring capital expenditure, if any.”
2.2 These Directions shall come in to effect immediately and be applicable until 31 December 2020.
3.1 Licensed banks incorporated or established iu Sri Lanka shall refrain from declaring cash dividends not already declared for financial year 2019 and any interim cash dividends for financial year 2020.
3.2 Licensed commercial banks incorporated outside Sri Lanka shall refrain from repatriation of profits not already declared for financial years 2019 and 2020.
“3.3 Licensed banks shall refrain from buying-back its own shares.”

3.4 Licensed banks shall refrain from increasing management allowances and payments to Board of Directors.
“3.5 Licensed banks shall exercise prudence and refrain to the extent possible from incurring non-essential expenditure such as advertising, business promotions, sponsorships, travelling and training. etc…”
3.6 Licensed banks shall exercise extreme due diligence and prudence when incurring capital expenditure, if any.”

Quibit


Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics

HNB & Sampath Bank dividends likely to be cancelled.

Sri Lanka halts dividends, profit repatriation, share buy backs by banks Scree104

cseguide

cseguide
Vice President - Equity Analytics
Vice President - Equity Analytics

Quibit wrote:HNB & Sampath Bank dividends likely to be cancelled.

Sri Lanka halts dividends, profit repatriation, share buy backs by banks Scree104
I don't think it will be canceled because  they have stated-----------not already declared for financial year 2019 and any interim cash dividends for financial year 2020.-----------

Junior investor

Junior investor
Manager - Equity Analytics
Manager - Equity Analytics

if sampath and hnb were going to cancel declared dividend now then imagine the decline of current market price. below 50 for both bank for sure.

thankrishan


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

Bank and finance stock prices will be highly effected. Can evidence it today.

6Sri Lanka halts dividends, profit repatriation, share buy backs by banks Empty CBSL's restriction on dividends Thu May 14, 2020 4:13 pm

Antonym

Antonym
Vice President - Equity Analytics
Vice President - Equity Analytics

Junior investor wrote:if sampath and hnb were going to cancel declared dividend now then imagine the decline of current market price. below 50 for both bank for sure.
Hello, Junior Investor.

Dividends had been recommended/announced - but not yet declared.

They were scheduled to be declared at the AGMs (SAMP's is on June 2nd). I am not sure how CBSL's restriction on dividends will be interpreted in this case.

heshan1997


Equity Analytic
Equity Analytic

ah crap.

bhanu


Manager - Equity Analytics
Manager - Equity Analytics

Antonym wrote:
Junior investor wrote:if sampath and hnb were going to cancel declared dividend now then imagine the decline of current market price. below 50 for both bank for sure.
Hello, Junior Investor.

Dividends had been recommended/announced - but not yet declared.

They were scheduled to be declared at the AGMs (SAMP's is on June 2nd). I am not sure how CBSL's restriction on dividends will be interpreted in this case.
Damn.. yes.. you got a point.. so will sampath trade at 80 -90 🤔

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