If any of the supervised entities fails to comply with this recommendation, it is required to notify the Agency at least one month before the intended payment of dividend and it must justify its decision and reasons for it.

Slovenian insurers received yesterday a leter from the Slovenian Insurance Supervision Agency recommending them to suspend the payment of dividends even after 1  October 2020, with the aim of ensuring financial stability during the COVID-19 epidemic. As a reminder, earlier this year the supervisor reccomended suspension of dividends until 1 October 2020.

The Supervision Agency recommends that the management boards of supervised entities propose to their supervisory boards and general meetings of shareholders to extend the moratorium on dividend payments at least until the moment of issuing the auditors’ opinions on the 2020 annual reports.

However, the Agency states that they are aware that the operations of supervised entities are impacted differently due to their different business models. If any of the supervised entities fails to comply with this recommendation, it is required to notify the Agency at least one month before the intended payment of dividends. In the notification, the supervised entity must justify its decision and reasons for it, both qualitatively and quantitatively, on previously performed reliable stress test results with precise stress test assumptions and calculations of impacts on assets, liabilities, available capital and capital adequacy of the supervised entity for at least until the end of 2024. The Agency expects that, even in the case of paying out dividends, the supervised entity will ensure the target capital adequacy during that period.