As the COVID-19 virus continues to dominate our lives, we are
coming across more and more headlines like these:
"Coronavirus: Big banks stop shareholder dividends until
the end of 2020" (news.sky.com), "JPMorgan warns
it could suspend dividend in 'extreme' scenario
(ft.com)".
These entities and their decisions on whether to distribute a
dividend or otherwise, have come under the spotlight because of
their systemic relevance to a country or industry and hence their
continued financial health is not only important to a select group
of stakeholders but to society at large. On the other hand,
although smaller privately-owned companies are unlikely to pose
systemic risk, they too, albeit on a smaller scale, face a dilemma
whether to return profits to the shareholders by way of dividends
during such uncertain times.
