Federal Reserve Caps Bank Dividend Payments after Pandemic Analysis

Posted on June 25, 2020 5:14 pm

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URL https://www.voanews.com/economy-business/federal-reserve-caps-bank-dividend-payments-after-pandemic-analysis 

The U.S. Federal Reserve announced Thursday it will cap big bank dividend payments and bar share repurchases until at least the fourth quarter after finding lenders faced significant capital losses when tested against an economic slump caused by the coronavirus pandemic.

In its analysis, the Fed found that the country’s largest lenders have struggled to model the unprecedented downturn and ensuing rescue programs, adding to already unprecedented uncertainty about how banks and the economy overall would perform in the coming months.

The Fed did not say how each bank fared under the pandemic analysis but found the 34 tested firms could suffer