Bank of England considering to permit banks to restart dividend payments next year

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The Bank of England and UK banks are reportedly “bartering” a deal that would allow banks to restart paying dividends from next year in order to boost lending and drive the economy.

According to a report in The Times, the Bank of England has agreed to the change in policy as long as banks’ loss-absorbing capital buffers remain strong and net lending continues to rise.

Earlier this year the head of Prudential Regulation Authority wrote to a number of large banks, prompting them to cancel any outstanding dividends for 2019 and the remainder of this year. Banks, however, have argued the current policy makes them unattractive to investors.