Fed keeps some limits on bank dividends

Federal Reserve

The Federal Reserve decided to keep some limits in place on bank dividends after it published its second round of stress-testing on December 18.

In the first quarter of 2021, dividends and share buy-backs will be tied to a firm’s income over the past year. Where a firm did not earn income, it will not be able to pay a dividend or make buy-backs. The Fed said the decision to extend the limits on banks’ distributions due to the “ongoing economic uncertainty”.

Under the stress tests, all banks

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