By Ben Otto

Singapore's central bank will lift dividend restrictions placed on local banks and finance companies during the Covid-19 pandemic last year, citing an improving economic outlook and healthy positions among the city-state's financial institutions.

The Monetary Authority of Singapore on Wednesday said the restrictions introduced a year ago wouldn't be extended.

The restrictions had called on locally incorporated finance companies to keep their total 2020 dividend payouts to a maximum of 60% of 2019 levels, among other measures, to ensure lenders could support individuals and businesses in the Southeast Asian financial hub during the pandemic.

"The global economic outlook has since improved," MAS said in a statement Wednesday. It added that local banks and finance companies had maintained strong capital-adequacy ratios, and were well-positioned should global recovery stall amid possible vaccination delays and the spread of mutated virus strains.

Write to Ben Otto at ben.otto@wsj.com

(END) Dow Jones Newswires

07-28-21 0655ET