De Nederlandsche Bank (DNB) has announced on Monday that insurers can resume dividend payments later this year, as the impact of the COVID-19 crisis on their balance sheets was not as adverse as expected.
Back in April, the Dutch central bank advised insurers to postpone dividend payments as huge uncertainty loomed on whether capital buffers could withstand the economic disruptions caused by the coronavirus pandemic.
The move was also in adherence with the recommendations of the European Insurance and Occupational Pensions Authority (EIOPA), Europe’s main insurance regulator.
Insurers with strong capital positions could map out plans for their payment restarts, DNB said. However, the central bank urged financial institutions to suspend dividend payments or the buying back of shares until at least the end of the year.
“The direct impact of the corona[virus] crisis on insurers in general has so far been limited,” the bank said in a statement. “Against this background, DNB will take dividend proposals by insurers under normal consideration again.”
