Under APRA’s prudential standard 110 on Capital Adequacy, GMA...

Under APRA’s prudential standard 110 on Capital Adequacy, GMA can only pay a dividend up to the combined amount of profit in its 2 previous six-monthly returns submitted to APRA.

To achieve dividend capability in 1h21 GMA needs to first offset the statutory $17.6m after-tax loss in 2h20, with 1q21 contributing $3m to this.

Any 2q21 earnings above the remaining $14.6m can be considered by the board for potential dividend payments.

So while a 1h21 dividend is possible, it would likely be limited. A resumption of dividends at the full year result looks more plausible.

From APRA PS 110:

“An ADI or authorised NOHC (as applicable) must obtain APRA’s written approval prior to making any planned reduction in capital, whether at Level 1 or Level 2. A planned reduction in an ADI’s capital includes:”

“the aggregate amount of dividend payments on ordinary shares that exceeds an ADI’s after-tax earnings after taking into account any payments on more senior capital instruments, in the financial year to which they relate.”

“‘Financial year’ means a period of 12 consecutive months covered by one or more sets of publicly available operating results preceding the date of the proposed payment of dividend or interest. For example, where an ADI makes available half-yearly operating results, a financial year will refer to the preceding two publicly available half-yearly operating results for the ADI.”