FONT-SIZE Plus   Neg

State Street Boosts Dividend, To Buy Back Up To $1.8 Bln Of Stock

Custodial bank State Street Corp. (STT) on Wednesday announced a 33 percent increase its quarterly dividend and said its board has approved a new share repurchase program of up to $1.8 billion in common stock. The announcement comes a day after the Federal Reserve announced that the company has passed its annual stress test.

The Boston, Massachusetts-based company announced a quarterly dividend of $0.25 per share of common stock, up 33 percent from the $0.18 per share dividend paid on January 17, 2012.

The company noted that the increase restores the dividend to its previous split-adjusted high of $0.24 per share of common stock, most recently paid on January 15, 2009.

State Street also said its board of directors has approved a new common stock purchase program authorizing the purchase of up to $1.8 billion of common stock through March 31, 2013.

The new program follows the company's 2011 common stock purchase program that was completed in November last year, under which it purchased about $675 million of its common stock.

State Street said that the Federal Reserve reviewed the company's capital plan and did not object to its requested capital actions.

On Tuesday, the Federal Reserve said that 15 of the 19 largest U.S. Banks, including State Street, would have sufficient capital to withstand large projected losses in the event of another credit crisis.

Many of the large bank holding companies that passed the stress tests later announced dividend increases and stock buyback programs. JPMorgan Chase & Co. (JPM) was the first to act. The company announced a new $15 billion stock repurchase program and raised its dividend.

U.S. Bancorp (USB) announced a 56 percent increase in the dividend rate and an authorization to repurchase up to 100 million shares of its common stock. Wells Fargo & Co. (WFC) and BB&T Corp. (BBT) also announced dividend hikes.

In mid-January, State Street reported a profit for the fourth quarter that more than quadrupled from the prior year, reflecting revenue growth and lower expenses. However, total fee revenue for the quarter decreased 4 percent.

In Wednesday's session, STT is trading at $44.45, up $0.58 or 1.32 percent on a volume of 1.54 million shares.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Retailers could see record web traffic this year as more consumers then ever before plan to shop online, according to Deloitte's 31st annual holiday survey of consumer spending intentions and trends. The survey found that holiday shoppers this year plan to spend just as much as online as they spend in brick and mortar stores. Oil giant Chevron Corp. on Friday reported a 37 percent decline in profit for the third quarter from last year, reflecting lower oil prices and weak refining margins. However, both revenue and earnings per share for the quarter beat analysts' estimates. In addition, the company raised its quarterly dividend. Mastercard Inc. (MA) reported a profit for the third quarter of 2016 that increased about 21 percent from the year-ago period, while it was up 15% excluding a special item related to the termination of the U.S. employee pension plan taken in last year's third quarter. Both earnings per share and revenue for the quarter beat analysts' expectations.
comments powered by Disqus
Follow RTT