Don't Bank on More Dividend Boosts

As the earnings season begins, Wall Street is bracing for another difficult quarter from bank stocks. A dividend increase by any bank will be rare this earnings season, particularly as they look to shore up capital as loan losses mount. Other banks that have cut their dividend this year include Citigroup(C Quote), Washington Mutual(WM Quote), National City(NCC Quote) and Huntington Bancshares (HBAN Quote), among a host of others.

"This increase which reflects the company's performance and our confidence in its long-term growth, is possible because of our time-tested vision and values, diverse business model and our talented team," Wells Fargo CFO Howard Atkins said in a statement.

Another exception could be U.S. Bancorp (USB Quote). The company reported growing revenue and a rosy outlook Tuesday, even though profits slid vs. the year-ago quarter.

"Well, first off, that's a board decision, they have to make that decision, but based on the current performance of the company and based on the bias of myself, the management committee and the board, yes that is our intent," Chairman and CEO Richard Davis said during an earnings call, after one participant asked if the company intended to extend the company's record of 36 years of annual dividend increases.

"There are really three components: it is what you retain for yourself, it's what you put in stock buy backs and what you put in the dividend. I think with stock buy backs out of the picture for the rest of the year, that was code to tell you guys ... we will continue to have plenty of retained earnings and core capital generation, that's why we will continue to build the story around the logic of why we think we can be so assured that the dividend is safe," Davis said.