JPMorgan Chase (JPM) has announced a new $50 billion U.S. stock buyback program and raised its dividend by 10% after clearing the U.S. Federal Reserve’s latest bank stress test.
JPMorgan is the largest commercial bank in America with assets under management of $4.4 trillion U.S.
It said in a written statement that it will increase its quarterly dividend 10% to $1.65 U.S. per share and begin the new stock buyback program effective on July 1 of this year.
JPMorgan previously paid a quarterly dividend to its shareholders of $1.50 U.S., giving its stock a yield of 1.80%.
The bank has paid a quarterly distribution since 1985 and has now raised its dividend for 14 consecutive years. Dividend increases were paused in the years after the 2008 financial crisis.
“The Board’s intended dividend increase is supported by our consistent investment in our business and strong financial performance,” said JPMorgan CEO Jamie Dimon in the statement.
The increased shareholder returns come after the Federal Reserve’s annual stress test, which found that all 32 large U.S. banks remained above their minimum capital requirements.
This year’s stress test ran banks through a hypothetical recession that generated more than $708 billion U.S. in projected losses across the financial industry.
JPMorgan wasn’t the only large U.S. bank to raise its dividend after passing the U.S. central bank’s annual stress test.
Goldman Sachs (GS) and Wells Fargo (WFC) each announced that they are increasing their dividends by 11%.
Bank of America (BAC) CEO Brian Moynihan said in a statement that he will make an announcement on the firm’s dividend next month.
JPM stock has gained 17% in the last 12 months to trade at $333.45 U.S. per share.
