finance

Morgan Stanley, JPMorgan, Bank of America, Goldman Sachs hike shareholder payouts


4/4

© Reuters. FILE PHOTO: A sign is displayed on the Morgan Stanley building in New York U.S., July 16, 2018. REUTERS/Lucas Jackson/File Photo

2/4

(Reuters) – Morgan Stanley (NYSE:), JPMorgan Chase & Co (NYSE:), Bank of America Corp (NYSE:). and Goldman Sachs (NYSE:) Group said on Monday they were hiking their capital payouts after the U.S. Federal Reserve gave them a clean bill of health following their annual “stress tests” last week.

Morgan Stanley delivered one of the biggest surprises to investors by announcing it would double its dividend to 70 cents a share in the third quarter. Some analysts had been expecting a boost of about 50 cents a share from the current 35 cents.

The bank also said it would increase spending on share repurchases, and the Wall Street giant’s shares rose as much as 3.7% in after-market trading following the announcement.

Morgan Stanley CEO James Gorman said in the announcement that the bank could return so much capital because of the excess it has accumulated over several years. The action, he said, “reflects a decision to reset our capital base consistent with the needs we have for our transformed business model.”

Bank of America said it will increase its dividend by 17% to 21 cents a share beginning in the third quarter of 2021, and JPMorgan said it will go to $1.00 a share from 90 cents for the third quarter.

Goldman Sachs said it planned to increase its common stock dividend to $2 per share from $1.25.

Bank of America’s shares were flat in after hours trading, Goldman Sachs’ shares were up 0.6%, while Citigroup (NYSE:)’s and JPMorgan’s were down 0.9% and 0.3% respectively.

Large banks no longer face pandemic-era restrictions on how much they can spend buying back stock and paying dividends, the Fed said on Thursday after finding the firms would remain well capitalized in its latest stress tests.

The central bank said the test found 23 of the largest firms would suffer a combined $474 billion in losses under a hypothetical severe downturn, but would still have more than twice as much capital required under Fed rules.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.  Learn more