“Banks could pay dividend on fairness shares from the earnings for the monetary yr ended March 31, 2021, topic to the quantum of dividend being no more than fifty % of the quantity decided as per the dividend payout ratio prescribed,” the central financial institution mentioned in a notification.
Method again on Could 04, 2004 the Reserve Financial institution had come out with standardized norms for dividend declaration.
A financial institution ought to have a minimum of 9 % capital adequacy ratio, a capital upkeep gauge, for previous two accomplished years and the accounting yr for which it proposes to declare dividend.
The online non-performing ratio ought to be lower than 7 %.
The dividend payout ratio shall not exceed 40 % and shall be as per a mandated matrix.
“In view of the persevering with uncertainty attributable to the continuing second wave of COVID-19 within the nation, it’s essential that banks stay resilient and proactively increase and preserve capital as a bulwark in opposition to surprising losses,” RBI mentioned on Thursday.
On April 21, ET wrote that non-public banks, recognized for rewarding buyers, had been unlikely pay dividend in FY21 amid the localized restrictions on mobility.
, largest by market capital, didn’t declare dividend.
RBI didn’t allow banks to pay any dividends in 2019-20 too. In April final yr, it barred banks from asserting any such rewards amid an outbreak of the pandemic.