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Wall Street is preparing another bumper payday for shareholders after the biggest US banks cleared the Federal Reserve’s annual stress tests. JPMorgan, Goldman Sachs, Citigroup, Wells Fargo, and Morgan Stanley all announced dividend increases within hours of the results, Bloomberg reports.
The payouts keep getting bigger: The six largest US banks returned more than USD 140 bn to shareholders through dividends and buybacks last year, surpassing the previous record set in 2019. The lenders also posted their strongest combined bottom lines since 2021, helped by record trading revenue.
This year’s exam came with a twist: Unlike previous years, banks no longer have to wait before announcing capital plans while the Fed overhauls the exercise. The agency said there is “no expectation” that lenders delay public disclosures of planned capital actions through 3Q 2027 — and separately froze stress-capital buffers until 2027, meaning this year's exam won't affect capital requirements.
The tests still matter: Introduced after the 2008 financial crisis, the tests measure whether banks could keep lending through a severe recession and market shock. But the annual review has become less onerous in recent years, with regulators moving toward a more bank-friendly framework.
JPMorgan led the payouts: JPMorgan lifted its quarterly dividend to USD 1.65 a share from USD 1.50 and authorized a fresh USD 50 bn buyback. Meanwhile:
- Goldman Sachs raised its payout to USD 5 from USD 4.50;
- Citigroup to USD 0.67 from USD 0.60;
- Wells Fargo to USD 0.50 from USD 0.45;
- Morgan Stanley to USD 1.15 from USD 1;
- Bank of America said it will announce its next quarterly dividend after its July board meeting and had almost USD 23 bn remaining on its buyback plan at the end of March.
MARKETS THIS MORNING-
Japan’s SoftBank fell 13%, leading declines across Asian equities as concerns mount over the rising costs of the AI boom. The decline dragged Japan’s Nikkei down 0.9%, while South Korean equities also fell 1.4%, led by declines across chipmakers. Meanwhile, Hong Kong’s Hang Seng index was down 1% while the mainland’s CSI 300 lost 0.8%.
Over on Wall Street, futures are hovering near the flatline after a similar sell-off among tech equities on the Nasdaq and S&P 500 yesterday.
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ADX |
9,876 |
-1.2% (YTD: -1.2%) |
|
|
DFM |
6,025 |
-1.4% (YTD: -0.4%) |
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Nasdaq Dubai UAE20 |
4,745 |
-2.2% (YTD: -2.9%) |
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USD : AED CBUAE |
Buy 3.67 |
Sell 3.67 |
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EIBOR |
3.4% o/n |
4.1% 1 yr |
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TASI |
10,933 |
-0.7% (YTD: +4.2%) |
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EGX30 |
51,443 |
-0.5% (YTD: +22.9%) |
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S&P 500 |
7,357 |
-0.0% (YTD: +7.5%) |
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FTSE 100 |
10,530 |
+0.7% (YTD: +6%) |
|
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Euro Stoxx 50 |
6,268 |
+0.9% (YTD: +8.2%) |
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Brent crude |
USD 74.73 |
-0.7% |
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Natural gas (Nymex) |
USD 3.32 |
-0.8% |
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Gold |
USD 4,034.5 |
-0.3% |
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BTC |
USD 59,420 |
-2.5% (YTD: -33%) |
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Chimera JP Morgan UAE Bond UCITS ETF |
AED 3.73 |
+0.3% (YTD: +1.7%) |
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S&P MENA Bond & Sukuk |
152.61 |
+0.1% (YTD: +0.5%) |
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VIX (Volatility Index) |
18.89 |
+1.4% (YTD: +26.4%) |
THE CLOSING BELL-
The DFM fell 1.4% yesterday on turnover of AED 1.0 bn. The index is down 0.4% YTD.
In the green: Spinneys (+2.4%), Mashreqbank (+1.5%), and Ithmaar Holding (+1.0%).
In the red: National Cement Company (-5.0%), BHM Capital Financial Services (-4.3%), and Dubai Electricity & Water Authority (-4.1%).
Over on the ADX, the index fell 1.2% on turnover of AED 1.7 bn. Meanwhile, Nasdaq Dubai was down 2.2%.
