Over half of investors think the stock market is rigged: Survey
British companies stop paying dividends to shareholders in the amount of £ 25 billion. This represents a third of the total planned payments expected by investors in the remainder of 2020. Companies are trying to save cash during the coronavirus crisis.
An unprecedented number of firms, representing 45% of the largest UK publicly traded companies, have already cut their planned payouts to investors or must, according to data from financial services firm Link Group..
UK insurance group agreed to waive £ 1.3bn in response to Bank of England’s call to consider canceling dividends due to the impact of the pandemic on business.
Companies including Aviva, RSA, Hiscox and Direct Line announced Wednesday that they are canceling their 2019 dividend and will not consider further payouts until the end of the year..
In March, the Bank of England warned the insurance industry about planned payments after British banks did the same. Link Group believes that the largest dividend cut occurred in the banking sector. However, Legal & General challenged the central bank by insisting on a £ 753 million dividend payment. Other UK-headquartered insurers, including Phoenix Group, Admiral and Prudential, have yet to comment on the matter..
The latest UK dividend monitoring from Link Group estimates that additional payments, including those planned by upstream and oil companies, of £ 24bn, expected by UK shareholders, remain uncertain..
That said, the £ 31 billion expected by investors is likely to come from companies in sectors such as food, beverages and tobacco, utilities, healthcare and consumer goods..
One of the leading UK fund managers asked the country’s 200 largest companies to warn them against raising funds from investors if there was no «good reason».
Mark Barnett and Martin Walker, co-directors of UK equity fund Invesco have urged companies to use government funding schemes such as the £ 330bn Covid corporate finance fund, Sky News reported.
However, Barnett himself failed after being fired from his £ 400m investment fund manager Monday for poor performance..
Barnett was removed from office after 20 years as manager of investment trust Invesco Perpetual Income and Growth Investment, after Perpetual stock lost more than 40% of its value in the past three months..