DETERMINANTS OF DIVIDEND POLICY IN PORTUGUESE BANKING SYSTEM

The purpose of this article is to identify the factors that influence the payment of dividends in banks operating in the Portuguese market. The study uses advanced financial data, in the period between 2005 and 2018. The model analyzed is tested using multiple regressions with data in the unbalanced panel. The results show that the payment of dividends is mainly driven by the historical distribution and the positive influence of performance. In addition, the size of the bank is significant, although with a sign opposite to that expected. Another valuable result is associated with the changes that occurred before, during and after the financial crisis. The study supports the hypothesis of the influence of the crisis on dividend policy. Evidence is presented that in the post-crisis period, dividends were conditioned by the policy of retention of results imposed by the authorities. The study presents limitations that must be taken into account as can represent restrictions on the results obtained. The size of the sample and the explicit policy of retention of results, imposed by authorities on some entities, stand out during part of the period under investigation.