Global dividends plunge to its worst since 2009

The world’s largest firms will slash dividend payouts by 17%-23%, amounting to as much as $400 billion, according to a new report as the COVID-19 pandemic continues to put a dent on the world’s economies.

Global dividend payouts have slumped by $108 billion to $382 billion for the second quarter of 2020, according to a report by fund manager Janus Henderson, which would be a 22% year-on-year drop. This would be the worst since 2009.

Almost all regions slashed payouts except for North America, where Canadian payments proved to be resilient. Worldwide, around 27% of firms lowered their dividends, with a worst-affected Europe cutting more than half.

Banks and other financial firms have been ordered by the European Central Bank to stop paying dividends accounted for half of the 45% reduction in Europe’s Q2 dividend drop to $77 billion.

Meanwhile, many are awaiting what decisions U.S. firms would take for the year and whether European banks would get permission to restart payments early next year.