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CBAâs three hurdles to buybacks and bigger dividends Save Share Commonwealth Bank CEO Matt Comyn revealed the bank is facing three obstacles to share buybacks and even bigger dividends as it announced a $3.9 billion cash profit on Wednesday and around $10 billion in excess capital. CBA is poised to shower shareholders with as much as $2.7 billion in dividends in late March, after raising the first-half distribution by 53 per cent to $1.50 a share compared with the previous half. However, the payout ratio of 67 per cent is just below the bankâs target range of between 70 per cent and 80 per cent, and Mr Comyn said the boardâs intention is to continue the tradition of delivering a bigger second-half dividend. But a number of hurdles remain. ....
Dividend rise, buybacks likely at CBA Feb 3, 2021 â 6.00pm Save Share Commonwealth Bank shareholders are poised to receive a 50 per cent increase in the dividend on February 10 over last yearâs reduced payment, as analysts are now looking towards the possibility of buybacks before the year is out. The bankâs board will be careful to tread a fine line between rewarding shareholders and the expectations of the prudential regulator when CEO Matt Comyn presents first-half results, but analystsâ reports suggest a significantly higher distribution is a foregone conclusion. Analysts are expecting CBA chief Matt Comyn to unveil a 50 per cent increase in the dividend. ....
LICs stand out for yield hunters Listed investment companies could be on the brink of a revival as the prospect of miniscule bank deposit interest rates for the next three years puts the spotlight on fully franked dividend yields. Feb 3, 2021 – 12.00am Share The Reserve Bank of Australia’s declaration that official interest rates will remain at the ultra-low 0.1 per cent for another three years must inevitably force retirees and others with money in the bank to go out on the risk curve. This means it is highly likely a big chunk of the $1.1 trillion in household bank deposits in Australia will shift to higher-yielding forms of investments, including equities. ....
End of dividend shackles a Christmas gift for bank bulls In yet another sign of Australia s impressive COVID-19 recovery, the prudential regulator will no longer cap bank dividends. But how hard will they bounce? Dec 15, 2020 – 10.48am Share The Australian Prudential Regulation Authority has copped its share of criticism over the past few years, but chairman Wayne Byres can end 2020 feeling pretty happy that a decade of work has delivered for the country at precisely the right moment. Having been smashed by the banking royal commission and others for essentially putting the stability of the financial system above other concerns – notably culture and competition – APRA could well argue that the pandemic has shown it had its priorities right. ....
MacroBusiness Access Subscriber Only Content Via the excellent Jonathon Mott at UBS: Australian economic recovery keeps surprising Over the last month a raft of economic data has surprised on the upside. Home lending; building approvals; retail sales; car sales; trade data and GDP all exceeded expectations. Additionally, new COVID-19 cases across Australia have approached zero (outside hotel quarantine) allowing many restrictions to be removed and most interstate travel to be re-opened. Consumer and business confidence have rebounded solidly. Credit risk is falling Given the improved environment, we are becoming increasingly comfortable with the outlook for credit impairment charges for the banks in Australia and NZ. (1) Within the institutional businesses there have only been a couple of corporate collapses this cycle (Virgin Airlines and Grocon), with ECM raisings and DCM liquidity helping to improve the credit outcome; (2) Although not all small business ....