Fed Stress Tests Passed, Most Top US Banks Raise Dividends

Regulation
โดย The Motley Fool·Read original
Summary · why it matters

The Federal Reserve's annual stress test found that all 32 of the largest U.S. banks have sufficient capital to withstand a severe recession, with the aggregate common equity tier 1 capital ratio falling from an actual 12.8% to a low of 11.2% but remaining above regulatory minimums. Because the Fed kept stress capital buffers unchanged from last year, eight of the ten largest banks—JPMorgan Chase, Goldman Sachs, Wells Fargo, Morgan Stanley, Citigroup, PNC, U.S. Bancorp, and BNY Mellon—immediately raised their dividends. Bank of America and Truist have not yet announced increases, though Bank of America is expected to do so when it reports second-quarter results on July 14. JPMorgan Chase also initiated a $50 million share buyback, Morgan Stanley launched a $20 million repurchase plan, and both Bank of America and Citigroup said they will continue multibillion-dollar repurchase plans. Bank stocks appear attractively valued, with several trading below 15 times earnings and others below 20 times earnings, and the second quarter looks strong for the sector.

Impact on stocks 13

Financials▲ · 8 stocks
Morgan Stanley
MS
▲ PositiveCapitalrelevance

Morgan Stanley raised its dividend and launched a $20 million share buyback after passing the Fed stress test.

U.S. Bancorp
USB
▲ PositiveCapitalrelevance

U.S. Bancorp raised its dividend after passing the Fed stress test.

Bank of America Corp
BAC
▲ PositiveCapitalrelevance

Bank of America is expected to raise dividends and continues multibillion-dollar repurchase plans after passing stress test.

Truist Financial Corp
TFC
± MixedCapitalrelevance

Truist has not yet announced a dividend increase, but passed the stress test; impact unclear.

Digital Finance & Tokenization▲ · 3 stocks
Citigroup Inc.
C
▲ PositiveCapitalrelevance

Citigroup raised its dividend and will continue multibillion-dollar repurchase plans.

JPMorgan Chase & Co
JPM
▲ PositiveCapitalrelevance

JPMorgan Chase raised its dividend and initiated a $50 million share buyback.

Artificial Intelligence▲ · 1 stocks
Others▲ · 1 stocks
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