By Peter Tálos/NTB
In a comprehensive review of the way savings banks are run in Norway, the government-appointed savings bank committee has looked at the practice of paying dividends to the owners or customers.
After a change in the regulations for the banks in the 1980s, it was opened up for the savings banks to move on from the traditional scheme of handing out gifts from their profits to so-called non-profit purposes. Examples reproduced in the report show that customers with large mortgages and deposits can receive over NOK 12,000 in customer dividends in some savings banks.
The committee now proposes to remove this. Among other things, they point out that the scheme of paying customer dividends is not part of the savings bank tradition.
Gifts only – no dividends
– After an overall assessment, the committee recommends that the provision that savings banks can pay out customer dividends be removed, the report states.
The committee points out that the introduction of paying out such a dividend was a breach of the original idea that profits in the local savings bank should go to the bank’s foundation capital, or should be distributed as gifts in the local area where it was founded. This is an arrangement that has been weakened in many places.
– In order to strengthen this tradition, the committee proposes to reintroduce the requirement that surpluses on the savings bank’s self-owned equity can only be used as gifts for non-profit purposes, it continues.
Easier to form an AS
On the other hand, the committee proposes that it be made easier to change savings banks into joint-stock companies.
The investigation is now due for consultation with a deadline of 3 February next year.
– I know there are many who have been waiting anxiously for the report from the savings bank committee. My impression is that the committee has done thorough work. I look forward to going through the investigation and the consultation input carefully, says Finance Minister Trygve Slagsvold Vedum about the investigation.
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