During the boom of the U.S. banking system during the previous decade, investors were rewarded with hefty capital gains and massive chunks of cash in the form of common stock dividends.
As we fast forward to the present, shareholders of these banks are yearning and thirsty for a return to the cash-rich days. With the release of the Federal Reserve’s Comprehensive Capital Analysis and Review (CCAR) results on Thursday afternoon, investors will learn if the largest U.S. banks will be allowed to return more capital to shareholders. Despite the upward trajectory of bank profits in recent years, banks and regulators are still haunted by memories of the massive liquidity crisis almost five years ago.
After last week’s Dodd-Frank stress test results showed consistent capital ratio improvement year over year for almost every bank, investors’ expectations for dividend growth and increased share repurchase capacity have crept higher. Here is a breakdown of what each bank proposed during last year’s CCAR process:
Click on the name of each company to see a preview of this year’s results:
| The Big Four | |
| Company Name | 2012 CCAR Capital Actions |
| Bank of America Corp (NYSE:BAC) | Did not request a dividend increase or new buyback approval. |
| Wells Fargo & Co (NYSE:WFC) | Approved: Increased dividend and share buybacks. |
| JPMorgan Chase & Co. (NYSE:JPM) | Approved: Increased dividend and share buybacks. |
| Citigroup Inc. (NYSE:C) | Denied: Increased dividend. |
| Regional Banks | |
| Company Name | 2012 CCAR Capital Actions |
| BB&T Corporation (NYSE:BBT) | Approved: Increased dividend and redeemed trust preferred securities. |
| Regions Financial Corporation (NYSE:RF) | Approved: Repurchase of preferred stock from TARP. |
| Fifth Third Bancorp (NASDAQ:FITB) | Denied: Increased dividend. Approved: Share buybacks. |
| KeyCorp (NYSE:KEY) | Approved: Share buybacks. Later increased dividend. |
| SunTrust Banks, Inc. (NYSE:STI) | Did not request a dividend increase or new buyback approval. |
| PNC Financial Services (NYSE:PNC) | Approved: Increased dividend and share buybacks. |
| U.S. Bancorp (NYSE:USB) | Approved: Increased dividend and share buybacks. |
| Others | |
| Company Name | 2012 CCAR Capital Actions |
| Goldman Sachs Group, Inc. (NYSE:GS) | Approved: Increased dividend and share buybacks. |
| Morgan Stanley (NYSE:MS) | Approved: Us (NYSE:USB)e of cash on acquisition of Morgan Stanley Smith Barney. |
| American Express Company (NYSE:AXP) | Approved: Increased dividend and share buybacks. |
| The Bank of New York Mellon Corporation (NYSE:BK) | Approved: Share buyback plan. Did not request a dividend increase. |
| Capital One (NYSE:COF) | Did not request a dividend increase or new buyback approval. |
| State Street (NYSE:STT) | Approved: Increased dividend and share buybacks. |
The article Preview: Another Week, Another Banking Stress Test originally appeared on Fool.com and is written by David Hanson.
David Hanson owns shares of Goldman Sachs. The Motley Fool recommends American (NYSE:AXP) Express, Goldman Sachs, and Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, Fifth Third Bancorp, JPMorgan Chase, KeyCorp, PNC Financial Services, and Wells Fargo.
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