UK banks warned ‘cut dividends still further'

Income seekers face an even tougher environment following a Bank of England warning that UK banks will have to slash dividends for years to come.

The BoE says banks will also have to rein in bonuses if they are to boost reserves and ready their balance sheets for strict new rules. Tough standards on capital and liquidity are due to be introduced later this year and banks are being urged to start preparing now by setting aside more profits as a buffer against bad debts, the Telegraph reports. Under pressure from the Bank of England and the FSA, banks last year cut dividends and reduced the amount paid in bonuses as a proportion of revenue. However, the Bank of England is now calling for more to be done to "sustain lending to the re...