The restrictions were measure introduced to ensure that local banks and finance companies have a strong lending capacity to support the economy throughout the pandemic.
With the improving global economic outlook, the Monetary Authority of Singapore (MAS) has given the green light to locally incorporated banks and finance companies headquartered in Singapore will be able to issue dividends in full to shareholders again, according to an announcement on Wednesday.
MAS previously asked banks and FI to cap their total dividends per share for FY2020 at 60 percent of FY2019’s DPS, and offer shareholders the option of receiving the remaining dividends to be paid for FY2020 in shares in lieu of cash.
MAS noted in the announcement that local banks and FIs have maintained strong capital adequacy ratios and continued to meet the credit needs of individuals and businesses, despite higher levels of provisioning made during the pandemic.
It also said that under the latest stress tests, these ratios are projected to remain resilient even under an adverse macroeconomic scenario of a stalled global recovery associated with delays in vaccine deployment and a global resurgence in the pandemic due to mutated virus strains, leading to the Singapore economy slipping again into recession in 2021.