Hargreaves Lansdown scraps special dividend as FCA reviews capital

FCA told the company yesterday it plans to review the amount it has to set aside in capital

Hargreaves Lansdown chief executive Chris Hill

Hargreaves Lansdown has decided not to pay a special dividend this year after the FCA said it would be reviewing the firm’s capital requirements.

In a market announcement, Hargreaves says it was told by the regulator yesterday that the FCA plans to reassess the amount the company needs to set aside in capital “given the group’s strong recent growth in scale and complexity”.

Hargreaves’ dividend policy is based on maintaining an ordinary dividend payout at around 65 per cent, and looks to pay out excess cash to shareholders in the form of a special dividend.

But the firm says the new capital limits set by the FCA would mean its surplus for next year would not meet its risk appetite if it paid a special dividend this year.

Hargreaves says: “Reflecting this policy and our notification from the FCA yesterday, the board expects to propose a final ordinary dividend that will generate a total ordinary dividend payout ratio of 65 per cent for the financial year ended 30 June 2017.

“The board has concluded it needs to retain an additional £50m of capital and hence the group will not pay a special dividend for the financial year ended 30 June.”

The company will issue its annual results on 15 August.


Peter Hargreaves 700x450

Peter Hargreaves throws weight behind new fund manager

Peter Hargreaves has put his weight behind a fund firm set up by ex-Artemis UK equities fund manager Stephen Yiu. Companies House filings reveal the Hargreaves Lansdown co-founder has been a “designated member” at Blue Whale Capital LLP since February 2017. Blue Whale is an asset manager operating out of Bath and was registered by Yiu, […]

Hargreaves and SJP dividends in ‘danger zone’

Hargreaves Lansdown and St James Place are among the financials in the “dividend danger zone”, according to AJ Bell’s latest Dividend Dashboard, with dividend cover of 1.1x each forecast for this year. Alongside mining, financials is responsible for 64 per cent of predicted dividend growth this year, but the former is dependent on commodity prices while […]


News and expert analysis straight to your inbox

Sign up


There are 2 comments at the moment, we would love to hear your opinion too.

  1. Just in case there any shadenfreude posts, I think it as well to consider that this is something that affect all. It is the outcome of burdensome, intrusive and hampering regulation which not only affects us all, but adds hugely to costs, which at the same time the regulator continually complains about the cost of advice.

    It is time that the FCA and that benighted consumer panel realise you can’t have your cake and eat it.

  2. Put simply another Government TAX TAX and more TAX which impinges on Shareholders who have earned their hard earned Taxed income into shares to gain a reasonable return. Now after the Pensions fraud of government who have engineered – these most offensive and unfair tax grabbing opportunities to fund their fallaces and follies E.G HS2 Rail lin between London and Birmingham – to allow HSBC directors to return back to London 20 minutes earlier – provided there are no leaves on the line ? or God forbid snow?

Leave a comment