ECB officially recommends eurozone banks to skip dividend payments at least until October

The European Central Bank recommended on Friday that eurozone banks should skip dividend payments and share buybacks at least until October 1st.

"The ECB considers it appropriate that the significant credit institutions refrain from making dividend distributions and performing share buy-backs aimed at remunerating shareholders during the period of the COVID-19-related economic shock," the official statement read. "The ECB recommends that at least until 1 October 2020 no dividends3 are paid out and no irrevocable commitment to pay out dividends is undertaken by the credit institutions for the financial year 2019 and 2020 and that credit institutions refrain from share buy-backs aimed at remunerating shareholders.

Market reaction

The EUR/USD pair continues to climb higher after this announcement and was last seen trading at 1.1107, adding 0.72% on a daily basis.