November 24, 2017 / 9:42 AM / a year ago

Polish regulator sets rules for bank dividends in 2018

WARSAW, Nov 24 (Reuters) - Poland’s financial market regulator KNF set new rules on Friday that banks must meet before they can issue dividends for 2018.

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

“It is recommended that banks meeting all of the above criteria be able to pay out up to 50 percent of their 2017 profits,” KNF said.

Banks which meet those requirements and also have a buffer that equals 2.5 percent of their total risk exposure could spend 75 percent of 2017 profit on dividend, KNF said.

KNF also said lenders meeting each requirement in addition to being able to prove they were immune to a negative macroeconomic shock would be pay all profits as a dividends.

However, KNF said banks with portfolios of foreign currency loans could pay out less of their profits in dividends, depending on the size of these portfolios.

The detailed rules issued in Polish, click on: here (Reporting by Agnieszka Barteczko and Marcin Goettig; Editing by Edmund Blair)

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