Swiss banks acquiesced to their regulator about reining in dividends, but still rewarded shareholders. Switzerland looks to become a haven for investors from the economic crisis, according to a new study.
The global pandemic is scarcely affecting Swiss companies in their payout policies – and is set to remain that way, asset manager Janus Henderson predicts in a quarterly dividend index. The U.S. based firm predicts that dividends will slump by as much as 35 percent, to $933 billion.
Banks, along with industrial companies highly attuned to economic swings as well as non-consumer goods firms, will be the most affected. Janus cites the example of Dankse Bank, which mothballed its shareholder payout plans in March and said it will revisit whether it will pay anything out for 2019.
Swiss Exception
Against the gloomy backdrop, Swiss banks are a notable exception, according to Janus: Swiss dividends are relatively resilient to the pandemic's effects, the asset manager said. Banks, for example, are holding fast to payout plans, even if they have been forced under regulatory pressure to stagger them in installments.
Janus said it views payouts from most major Swiss companies Swiss dividends as likely to be «relatively unscathed». The prospect of secure dividends is a potential boost to battered banking stocks – which have scarcely stood out as «payout pearls» in recent years – provided banks' business remains robust amid the upcoming recession.
Lavish Drugmakers
Switzerland is rich pickings for dividend yields: food and beverage giant Nestle as well as Novartis are among the top-20 globally for shareholder payouts. Pharmaceutical firm Roche also reliably lavishes its participation holders.
In March, the Basel-based drugmakers paid out a collective $14.3 billion to shareholders, according to calculations by Janus (Credit Suisse and UBS are miles from that sum). Janus evaluated the 1,200 largest firms by market capitalization in the world for the dividend study.
