March 14, 2018 / 11:53 AM / 9 days ago

Poland recommends banks pay up to 75 or 100 pct of profit in dividends

WARSAW, March 14 (Reuters) - Poland’s financial market regulator KNF on Wednesday recommended banks spend up to 75 or 100 percent on dividend payouts in the medium term, following an improvement in their capital base in 2017.

In November, it recommended paying up to 50, 75 or 100 percent of profit for 2017 on dividends, depending on the criteria a bank meets.

KNF said in a published statement that in order to pay out higher dividends banks cannot be undergoing restructuring, must have a leverage ratio above 5 percent and must have a Tier 1 and total capital ratio no lower than the required minimum plus 150 basis points.

The required minimum differs for different banks.

“It is recommended that banks fulfilling the above-mentioned criteria may pay (on dividends) up to 75 percent of the generated profit for the year preceding the decision,” KNF said in its statement, reiterating that some banks will be able to pay out all of their net profit in dividends.

KNF did not specify in its statement what timeframe the new guidelines apply to. (Reporting by Lidia Kelly; editing by Dasha Afanasieva)

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