Fund notification:
Income distributions update

As you will have read, many global companies have cut, cancelled, suspended or postponed their shareholder payments in the form of dividends (sums of money paid regularly to shareholders by a company out of its profits or reserves).

Companies are taking these actions as a result of the Covid-19 crisis. In some cases the companies are doing so on their own initiative to shore up their businesses during these difficult economic times; others are being asked or required to make the suspensions by policy makers like the Bank of England or governments as a stipulation of receiving state aid. These are unusual times.

When a company suspends or even cuts its dividend it is worth remembering that money does not necessarily disappear but is reallocated back into the business. As such, deferred or reduced payments often lead to a corresponding credit back to a company’s capital, which can strengthen its balance sheet.

At BNY Mellon Investment Management, our equity income funds distribute the income they receive from their underlying holdings. If the underlying holdings suspend or postpone their payments, the funds in turn must lower the income they distribute.

We believe this will most likely occur with respect to the forthcoming interim payment from a number of our equity income funds.

This is because we calculated the May dividend payments on the below funds, at what is called the ex-dividend (XD)[1] date. For the funds in our UK-domiciled Mellon Investment Funds (MIF) range and our Dublin-domiciled Mellon Global Fund (MGF) ranges that was 31 March 2020. While some companies had already reduced or cancelled their dividend prior to this date, reducing the amount we announced for the May dividend payments, there is a growing trend of companies continuing to suspend or postpone their dividends.

By how much the income distributions on our funds will be affected is hard to anticipate or forecast. Our equity income funds each invest in different regions, markets and companies, which in turn will be taking various actions with their dividend distributions.

We are monitoring the implications of the ongoing dividend cancellations or deferments on a daily basis. At this time we cannot provide accurate indications of future changes to your final May distribution. We will continue to work closely with our service providers, including our depositary and auditor, and will agree to reduce and restate any estimated May payments as required and believed to be in the best interest of investors.

We will keep you informed through notices on this website as this trend progresses and plays out within our own portfolios.

If you have any questions please contact our call centre:

  • From UK Freephone: 0800 614 330
  • From overseas: +44 (0) 20 3528 4002
  • Office hours: 8.30 am until 5.30 pm Monday to Friday BST (excluding bank holidays)
  • Email: [email protected]

BNY Mellon Investment Management’s equity income-distributing funds:

BNY Mellon Asian Income Fund
BNY Mellon Emerging Income Fund
BNY Mellon Equity Income Booster Fund
BNY Mellon Equity Income Fund
BNY Mellon Global Income Fund
BNY Mellon Global Infrastructure Income Fund
BNY Mellon Multi-Asset Income Fund
BNY Mellon UK Income Fund
BNY Mellon US Equity Income Fund

BNY Mellon Asian Income Fund (USD)
BNY Mellon Global Equity Income Fund (USD)
BNY Mellon Global Infrastructure Income Fund (USD)
BNY Mellon Global Multi-Asset Income Fund (EUR)
BNY Mellon U.S. Equity Income Fund (USD)

[1]This means investors who purchased the fund(s) on or before the XD date (31 March 2020) are entitled to the fund’s next dividend payment; those who purchased the fund(s) on or after 1 April, are not.