The seven largest banks in the UK have agreed to the proposal put forward by the Prudential Regulation Authority (PRA) that they suspend dividends and bonuses until the end of 2020.
In a statement, HSBC, Nationwide, Santander, Standard Chartered Bank, Barclays, RBS and Lloyds Banking Group said they will 'suspend dividends and buybacks on ordinary shares until the end of 2020' and 'cancel payments of any outstanding 2019 dividends'.
The banks were given a short window in which to agree to the PRA's proposals and publish a statement of their intentions. Alongside dividend suspensions, banks will also conserve cash by not paying cash bonuses to senior staff (including all material risk takers).
The PRA has also reiterated its confidence in UK banks in weathering the crisis created by the effects of the coronavirus (COVID-19) based on their recent stress test results.
Commenting on the issue, Philippa Kelly, Head of the Financial Services Faculty at the Institute of Chartered Accountants in England and Wales (ICAEW), said: 'The regulator has made it abundantly clear that banks and insurers should put households and businesses first to make sure the economy remains as resilient as possible in the coming months.'