Big Banks Announce Dividend Plans

Shares of Morgan Stanley (MS) climbed after the financial institution introduced plans for inventory dividends and buybacks. Morgan Stanley shares rose over 3% after the corporate elevated its dividend and introduced a $20 billion inventory buyback.

Goldman Sachs, Financial institution of America, and Wells Fargo additionally boosted their dividends. Goldman had one of many largest dividend will increase, with a 25% hike to $2.50 per share. Financial institution of America’s improve got here to five%, whereas Morgan Stanley raised its dividend by 20%.

JPMorgan and Citigroup each held the road on their dividends, and stated that more and more stringent capital necessities compelled the corporations to maintain them unchanged. JPMorgan did announce a brand new $30 billion inventory buyback plan that started again in Might.

“It’s notable that JPMorgan and Citi didn’t improve their dividends provided that they’re much extra cautious in regards to the well being of U.S. customers than different banks, and regardless that they’ve ample capital to maintain a downturn, they nonetheless suppose it’s prudent to be extra capitalized throughout this era of uncertainty,” stated Caleb Silver, Editor-in-Chief of Investopedia.

The bulletins got here within the wake of the Federal Reserve’s financial institution stress exams that decided how far more capital banks might allocate to shareholders with out depleting their capital. All 34 of the banks handed the take a look at. 

Shares of JPMorgan (JPM), Citigroup (C), Financial institution of America (BAC), and Wells Fargo (WFC) have been flat after the announcement.