Bank shares surge after most get the go ahead from the Fed to raise dividends, buybacks

The biggest U.S. banks announced plans to buy back tens of billions of dollars in stock and hike their quarterly dividends after passing an annual stress test by the Federal Reserve.

Bank shares rose broadly on the news, with Bank of America, Citigroup and J.P. Morgan Chase trading at least 1 percent higher before the bell. Wells Fargo, meanwhile, jumped 3.9 percent.

Wells Fargo said it would more than double its stock buybacks to $24.5 billion and raise its quarterly dividend to 43 cents a share from 39 cents.

Citigroup said it would hike its quarterly dividend 13 cents, to 45 cents, and buy back $17.6 billion of stock over the next year after passing the Fed’s annual stress test.

J.P. Morgan Chase announced it would raise its quarterly dividend to 80 cents from 56 cents a share, and buy back up to $20.7 billion in stock.

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