Dividend pay-outs were slashed by £22 billion over the past three months as investors felt the impact of the coronavirus pandemic, according to new figures.

The latest dividend monitor by finance firm Link Group has revealed that dividends paid out by UK companies plunged by 75% in the second quarter of 2020.

Susan Ring, chief executive of corporate markets at Link Group, said that 2020 will “without doubt, see the biggest hit to dividends in generations” due to the enormous economic impact of coronavirus.

The new report showed that 176 companies cancelled their dividends altogether and another 30 cut them, comprising about three-quarters of firms which would typically pay dividends in the period.

It said that headline dividends for the quarter to the end of June fell 57.2% to £16.1 billion, about £22 billion less than in the second quarter of 2019.

This represents the lowest second-quarter figure since 2010, with the decline itself “by far the biggest” ever recorded.

Meanwhile, 61 companies increased their pay-outs despite the global financial crisis.

Ms Ring said: “The second quarter was truly a record breaker. Not by a whisker, nor by a nose, but by a mile.

“As the lockdown wore on and restrictions became ever tighter, the economic damage spread to more and more companies.

“At the same time, it became clearer which companies were more resilient, and we were able to assess more accurately how deep cuts would go for those companies not simply cancelling pay-outs altogether.

“The cuts have been made to protect balance sheets in the face of horrendous disruption to trading and to the economy.”