Thorsten Beck, Francesco Mazzaferro, Richard Portes, Jean Quin, Christian Schett, 23 June 2020

On 27 May, the ESRB General Board adopted a wide-ranging recommendation to suspend pay-outs across different segments of the European financial system until the end of 2020. This column discusses why arguments for such restrictions weigh stronger than ownership and management rights during these unprecedented times. It provides a rationale for why the recommendation is a wide-ranging one, including banks, investment firms, insurance companies and CCPs and referring to all voluntary pay-outs, including dividends, share buy-backs and variable remuneration to material risk-takers.

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