JPMorgan, Goldman Sachs, Morgan Stanley, & Wells Fargo raise dividends

(Alliance News) - JPMorgan Chase & Co, Goldman Sachs Group Inc, Morgan Stanley and Wells Fargo & Co on Wednesday each raised their quarterly dividends after the US Federal Reserve said banks were "well positioned" to weather a "severe recession".

JPM announced its intention to raise its quarterly common stock dividend to USD1.65 per share for the third quarter of 2026, up 10% from its second-quarter dividend of USD1.50 per share. The bank also announced a USD50 billion buyback, effective July 1.

"The board's intended dividend increase is supported by our consistent investment in our business and strong financial performance," said Jamie Dimon, JPM chair and chief executive officer. "The new share repurchase program provides us with the flexibility to deploy capital in ways that enhance shareholder value over time."

Goldman Sachs, meanwhile, announced a dividend increase to USD5.00 per share, up 11% from its second-quarter dividend of USD4.50 per share, effective July 1, 2026.

"Our planned dividend increase reflects the strength of our franchise, our earnings power, and our confidence in our ability to support clients, invest for the long term, and deliver sustainable returns to shareholders," said David Solomon, Goldman chief executive officer.

Morgan Stanley increased its dividend for the third quarter by 15% to USD1.15 per share from its current dividend of USD1.00. The bank also reauthorised a USD20 billion equity share repurchase programme.

"Our financial strength gives us ongoing flexibility to invest in growth opportunities across the Integrated Firm while increasing the return of capital to shareholders," said Ted Pick, chair and chief executive officer of Morgan Stanley.

Wells Fargo & Co announced an 11% increase of its stock dividend to USD0.50 per share from USD0.45 per share.

The increased dividends and share buybacks follow results of the Fed's annual bank stress test, which confirmed that large banks are able to continue household and business lending activities, with strong positioning in the event of a recession.

"Today's results underscore the strength of the banking system," said Michelle Bowman, vice chair for supervision at the Fed. "As we work to increase the transparency and accountability of the stress test, public feedback will help us continue to improve and instill greater confidence in the stress test and its results."

The Fed noted that all 32 banks tested remained above their minimum common equity tier one capital requirements during a hypothetical recession scenario. The test scenario included a 39% decline in commercial real estate prices and a 30% decline in house prices, with an unemployment rate of 10%. The test concluded that even if the banks collectively absorbed USD708 billion in loan losses, capital declined only 1.6% in aggregate, above minimum capital requirements.

Shares in Morgan Stanley closed down 2.8% at USD219.86 each in New York on Wednesday. Goldman shares closed down 1.6% at USD1,076.91, Wells Fargo shares closed up 0.2% and JPMorgan shares closed down 0.2% each in New York.

By John Robaina, Alliance News reporter

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