Wells Fargo increases quarterly dividend by 14 percent
By Rick Rothacker
(Reuters) - Wells Fargo & Co (WFC.N: Quote) on Tuesday raised its quarterly stock dividend by 14 percent as it awaits U.S. Federal Reserve permission to potentially return even more capital to shareholders in the coming year.
The No. 4 U.S. bank by assets said in a statement that the increase of 3 cents to 25 cents per share was part of a capital plan that received approval from the U.S. Federal Reserve in 2012.
Wells in March raised its quarterly dividend by 10 cents to 22 cents per share after the Fed completed annual stress tests on large U.S. banks. In the aftermath of the financial crisis, banks now need the Fed's assent before increasing dividends and buying back more shares.
The San Francisco-based bank said it asked the Fed permission to return more capital to shareholders as part of its 2013 capital plan, which is under review. The Fed is expected to complete its work in March, after which approved banks can raise dividends or buy back more shares for the period that runs from the second quarter of 2013 through the first quarter of 2014.
"We remain committed to returning more capital to our shareholders," Wells Chief Executive John Stumpf said in a statement.
The dividend of 25 cents per share is payable March 1 to stockholders of record on February 1.
Wells has about 5.3 billion shares outstanding. The increased dividend is worth an extra $12.7 million to Wells' largest shareholder, Warren Buffett's conglomerate Berkshire Hathaway (BRKa.N: Quote), based on Thomson Reuters data.
Wells has emerged as one of the healthier U.S. banks since the financial crisis. It has been able to raise payouts for shareholders in recent years, while rivals such as Bank of America Corp (BAC.N: Quote) and Citigroup Inc (C.N: Quote) are still paying a penny per share each quarter as they work to build capital and reliable profits. Continued...