Singapore - MAS calls on local banks to moderate FY2020 dividends

29 July 2020

The MAS has called on locally-incorporated banks headquartered in Singapore to cap their total dividends per share ("DPS") for FY2020 at 60% of FY2019's DPS, and offer shareholders the option of receiving the dividends to be paid for FY2020 in scrip, in lieu of cash.

MAS's stress tests have shown that local banks remain resilient even under adverse conditions consistent with a serious and prolonged public health crisis. Nonetheless, given the substantial uncertainties ahead and that global economies are not yet showing sustained signs of recovery, the MAS believes it would be prudent for local banks to put aside a greater portion of earnings during this period.

The restriction is intended as a pre-emptive measure to bolster local banks' resilience and capacity to support lending to businesses and individuals through an uncertain economic period ahead.