Big Banks Increase Dividends After Strong Results From Fed Stress Tests
Key Takeaways
- With the Federal Reserve giving major financial institutions high marks in its annual stress tests, several large banks raised their dividends.
- JPMorgan’s board approved both a dividend hike plus a new $50 billion share repurchase program.
- Bank of America, Citigroup, and Wells Fargo also plan dividend increases, pending approval by their boards.
Following positive results in the Federal Reserve’s annual stress tests, several major banks are boosting their dividends, and JPMorgan Chase (JPM) is also adding a new stock buyback program.
JPMorgan announced it was increasing its quarterly dividend by $0.10 to $1.50 beginning this quarter, and the board approved a $50 billion share repurchase plan that began yesterday. CEO Jamie Dimon said the results of the stress tests “continue to demonstrate that banks are resilient, withstanding extreme hypothetical shocks while supporting the broader economy and financial markets.”
Bank of America (BAC) also plans to lift its dividend this quarter, to $0.28 from $0.26. For Citigroup (C), it’s to $0.60 from $0.56, and for Wells Fargo (WFC), it’s to $0.45 from $0.40. All three are pending board approval.
Shares of JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo are trading higher year-to-date.
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