IOPA has published today its Financial Stability Report.
The report includes a specific recommendation on dividends, as follows:
“EIOPA strongly recommends insurers to maintain extreme caution and prudence within their capital management. Any dividend distributions, share buy-backs or variable remunerations should not exceed thresholds of prudency and institutions should ensure that the resulting reduction in the quantity or quality of their own funds remains at levels appropriate to the current levels of risk. Supervisory authorities should ensure that insurers’ assessment of the overall solvency needs is forward-looking, takes due account of the current level of uncertainty on the depth, magnitude and duration of the impacts of Covid-19 in financial markets and on the economy and the repercussions of that uncertainty in their business models and solvency, liquidity and financial position”