Last March, Citigroup (C - Get Report), SunTrust (STI) and Fifth Third Bancorp (FITB) had their initial capital plans rejected during the CCAR and had to wait until August to receive approval on their revisions. Of those three, only Fifth Third was approved for a dividend increase. Neither Citigroup nor SunTrust tried again last year for a dividend increase. This year, banks have been free to push the envelope for initial capital plans, knowing they could immediately scale back their requests without waiting another five months for approval.
Citigroup and Bank of America (BAC - Get Report) are each paying a nominal quarterly dividend of just $0.01 a share, and didn't buy back any shares during 2012. With both companies continuing to go through major transitions, opinion is mixed on the level of capital returns investors can expect this year. JPMorgan Chase analyst Vivek Juneja, in a report Jan. 15, estimated that Citigroup would be approved to increase its quarterly dividend to $0.20 and that Bank of America would raise its quarterly dividend to $0.04. Juneja also estimated that Citigroup would be approved to repurchase $4.425 billion in common shares through the first quarter of 2014, while Bank of America would be approved to buy back $3.950 billion worth of shares.