Some of the biggest banks in the U.K. suspended dividend payouts and share buybacks until the end of 2020 following a request from the Bank of England to preserve capital to support the economy amid the market disruption brought about by the coronavirus pandemic.

The BoE's Prudential Regulation Authority said March 31 that banks entered the current operating environment "with strong capital positions, more than sufficient to accommodate the combined simultaneous impact of severe U.K. and global recessions and a financial markets shock." The regulator said it does not expect banks to need the earmarked capital to maintain their capital positions but the extra funds would help them support the local economy through the year.

In response, the biggest banks in the country, including HSBC Holdings PLC, Barclays PLC, Royal Bank of Scotland Group PLC and Santander UK Group Holdings PLC, put on hold pending dividend distributions in respect of 2019 and canceled any dividend payout for the rest of 2020. Standard Chartered PLC and Lloyds Banking Group PLC also adopted similar moves.

Some smaller players like finnCap Group PLC and International Personal Finance PLC also complied with the Prudential Regulation Authority's request. FinnCap Group added that its board members and some employees waived their salaries for three months to minimize the financial impact of the uncertainty caused by the outbreak, which is expected to have a material impact on the company's performance in the fiscal year ended March 31.

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The six big banks were due to distribute more than £8 billion in dividends in respect of their 2019 accounts, according to Reuters. HSBC, which is set to pay the biggest at $4.2 billion, said the first-quarter reported revenues in its global banking and markets segment would be impacted by the outbreak and warned of an increase in expected credit losses.

The Prudential Regulation Authority also said it expects banks to refrain from giving cash bonuses to their senior management. StanChart noted that it would take into consideration the current situation in deciding its 2020 remuneration policy and will provide an update on its reaction to the COVID-19 pandemic when it releases its first-quarter accounts April 29.

The Prudential Regulation Authority's move mirrors that of the ECB, which recently asked banks to suspend dividend distributions and share repurchases until at least October to conserve capital. Andrea Enria, chair of the ECB's supervisory board, also said the regulator could take action against banks that will not limit bonus payouts.