NEW YORK (
) -- Investors hoping for a
dividend boost from big banks in the near-term have been doubly disappointed this earnings season.
But as bank stocks have tumbled, the paltry dividend yields have become more attractive, creating an opportunity to buy shares at a discount ahead of distributions in the next couple of months.
Bank of America
was the latest on Wednesday to maintain its quarterly dividend, at a penny a share for common stock and $1.75 per share for its 7% Series B Preferred.
said Tuesday that its payout would be kept steady at a nickel per common share.
, too, announced on Dec. 8 that its common dividend would remain at 5 cents a share, as would distributions for its four classes of preferred stock. Both
also kept dividends steady -- at 5 cents per share for Morgan holders and 35 cents per share for Goldman's -- when reporting earnings this month.
hasn't paid common or preferred stock dividends, apart from that owned by the Treasury Department, in over a year. Management didn't indicate any near-term changes to that policy during the company's quarterly report or presentations either.
Investors had the most reason to be hopeful about a potential boost from JPMorgan, since it had been one of the first to repay bailout funds and appeared to be better capitalized than others. In a report three days ahead of JPMorgan's results, Rochdale Securities analyst Richard Bove said "expectations are high," that the company's payout would double to 10 cents a share. If it didn't, he predicted a stock slump as investors "will question its outlook."
Indeed, when JPMorgan issued its report, with a revenue disappointment and a less optimistic tone on credit than investors had hoped for, it set off a broad sell-off in the bank stocks. Since the close just prior to the report's release, JPMorgan's stock has been one of the hardest hit, losing 14%. Bank of America and
have both dropped 12%; Citigroup and
have each given up 10%; while Wells Fargo has declined 7%.
As prices have dropped, the dividend yield has become more attractive, even if the actual payout remain relatively meager. JPMorgan's yield has risen seven basis points to 0.52%; Bank of America's has risen three basis points to 0.27%; Wells Fargo's has climbed 5 basis points to 0.74%; Morgan Stanley's has risen 9 basis points to 0.73%; and Goldman's is up 10 basis points at 0.93%.
Looking ahead, JPMorgan common shareholders of record as of Jan. 6 will receive their nickel per share on Jan. 31. Bank of America common investors as of March 5 will get their penny per share on March 26. Wells Fargo common stockholders as of Feb. 5 will get their 5 cents per share on March 1.
Morgan Stanley will make its 5-cent payouts on Feb. 12 to common investors as of Jan. 29, and Goldman will distribute 35 cents per share on March 30 to common investors as of March 2.
-- Written by Lauren Tara LaCapra in New York