RBI caps bank dividend payouts at 75% of profit and tightens remittance rules
→Banks must meet capital conditions before distributions
Change
India’s RBI capped bank dividend payouts at 75% of profit after tax and linked distributions to CET1 capital thresholds with strict eligibility conditions.
Why it matters
The rules require banks to meet capital adequacy, asset quality and supervisory checks before payouts, with RBI retaining authority to block distributions and mandating reporting within 14 days.
Implications
- → Banks must complete capital and compliance checks — payouts can be blocked
- → Finance teams must report distributions within 14 days — strict timelines apply
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Source
View on Economic Times