UPDATE 1-New Zealand central bank eases restrictions on lender dividends as economy improves
(Add further details, Deputy Governor statement)
March 31 (Reuters) – The Reserve Bank of New Zealand on Wednesday announced it was easing dividend restrictions on lenders at the height of the COVID-19 pandemic following a stronger economic rebound than planned.
The changes allow banks to pay up to half of their profits in dividends, with the cap remaining in place until July 1, 2022, given the lingering uncertainties, the central bank said in a statement.
He cautioned banks, however, to be cautious in their approach and consider the need to meet higher capital requirements resulting from the RBNZ capital review.
“We have delayed the capital review implementation schedule twice in the past year to allow banks to benefit from the regulatory relief needed to support their customers. As economic conditions improve, creating strong capital buffers must be a priority, ”Reserve Bank Deputy Governor Geoff said. said Bascand.
The move comes after the central bank earlier this month removed some temporary liquidity facilities it had put in place during the pandemic as market conditions improved.
(Reporting by Rashmi Ashok in Bangalore; editing by Anil D’Silva)