With regard to payment of dividend by Banks for FY 2019-20, RBI has issued the following direction:
“In view of the ongoing stress and heightened uncertainty on account of COVID-19, it is imperative that banks continue to conserve capital to support the economy and absorb losses. In order to further strengthen the banks’ balance sheets, while at the same time support lending to the real economy, it has been decided that banks shall not make any dividend payment on equity shares from the profits pertaining to the financial year ended March 31, 2020.”
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However it is pertinent to mention and note that banks are declaring interim dividend or dividend on preference shares and the same would not be out of profits pertaining to financial year ending 31.03.2020.