July 3, 2020 / 8:50 AM / a month ago

RBS Chairman says banks 'not investible' after dividends scrapped

LONDON, July 3 (Reuters) - British banks are not investible after lenders were forced to scrap dividends by regulators to see them through the coronavirus crisis, Royal Bank of Scotland Chairman Howard Davies said.

Davies told a City & Financial webinar on Friday that regulators needed to rethink their capital framework for lenders by the autumn, adding that banks could not suspend payouts to investors indefinitely.

“It’s probably fair to say the banking sector is not investible because when people try to do the models about what banks are worth they can’t plug in any numbers for cash out.”

Starling Chief Executive Anne Boden, meanwhile, said banks would need government support in handling an expected spike in unpaid state-backed business loans in the coming months. (Reporting by Iain Withers; editing by Simon Jessop)

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