Credit Agricole Cancels 2019 Dividend
April 02 2020 - 1:52AM
Dow Jones News
By Pietro Lombardi
Credit Agricole SA has decided to cancel the 2019 dividend
following a recommendation from the European Central Bank.
France's second-largest listed bank by assets will propose to
shareholders meeting on May 13 to allocate the full net profit for
last year to reserves, it said late Wednesday.
The French bank's decision follows similar steps taken by other
European peers, including France's Societe Generale SA, after the
ECB asked the region's banks not to pay dividends or buy back
shares during the coronavirus pandemic.
The ECB wants banks to boost their ability to absorb losses and
support the economy as the eurozone braces for a sharp economic
slowdown caused by the pandemic. For this reason, it asked banks
not to pay dividends for 2019 and 2020 at least until Oct. 1,
adding that lenders should also avoid buybacks.
The October deadline is incompatible with French laws, under
which dividends have to be paid by the end of September, Credit
Agricole said.
The bank will lay out new guidelines for shareholders' returns
in the second part of the year. These can include an interim or
exceptional dividend.
Cancelling the dividend for last year will boost Credit Agricole
SA core capital ratio by 60 basis points, it said.
Write to Pietro Lombardi at pietro.lombardi@dowjones.com
(END) Dow Jones Newswires
April 02, 2020 01:37 ET (05:37 GMT)
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