The dividend policy of state-owned banks during an economic crisis

Isakov, Dušan; Keane, Allister; Schatt, Alain

doi:10.51363/unifr.ewp.5m3qw2

Back

Research report

The dividend policy of state-owned banks during an economic crisis

BP2-STS

Isakov, Dušan ORCID University of Fribourg, Switzerland
Keane, Allister HEC Lausanne, University of Lausanne
Schatt, Alain ORCID HEC Lausanne, University of Lausanne

2025

41 p.

English This study examines the dividend policy of Swiss state-owned banks during the recent economic crisis caused by the COVID-19 pandemic. Our empirical analysis shows that these banks had higher pre-crisis dividend payouts than other Swiss banks. While other banks reduced dividend payouts during the crisis, state-owned banks maintained higher dividend levels and consistent payout ratios throughout the economic downturn. Thus, the gap between state-owned banks and other banks increased from 18% before the crisis to 24% during the crisis. Moreover, we document that these higher payouts are not due to higher profitability of state-owned banks. Finally, we find no significant differences in dividend yields except when comparing public and private state-owned banks. Overall, this study provides evidence of the significant influence of dominant state shareholders on banks› financial policies in times of economic crisis.

Collections