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Banks are also attractive to investors because they have the capacity to increase their dividends from the current low levels, having bolstered their cash reserves after the financial crisis, said Michael Sheldon, chief market strategist at RDM Financial.
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US Bancorp has been under pressure to raise its quarterly dividend from the current 5 cents per share.
Citi's shareholders, however, will have to be patient before seeing a dividend increase, from the current 4 cents a year.
Panmure Gordon said its estimates already forecast a 10p dividend for the current year.
In our view it would be prudent to cut the dividend in half from the current 5.8p or £20m dividend payout and maintain the average net debt for 2012 at £45m-£50m £45m-£50m
Paying uninterrupted dividends since 1912, the current cash payout per share of $2.72 results in a dividend-yield of 3.60%.
That's when M&T will need to start paying more to the government for its bailout, a dividend of 9 percent, up from the current 5 percent.
Unless Washington acts, top tax rates on long-term capital gains could rise to 20 percent and on dividend income to 39.6 percent, from the current 15 percent top rate on both.
Calling the moves an effort to bring itself in line with industry peers, Sempra, an energy services company based here, said it would cut its quarterly dividend to 25 cents a share from the current 39 cents a share.
Dividends will be treated as ordinary income and taxed at a maximum rate of 39.6 percent, up from the current 15 percent rate for most dividends.
But past losses, which show up as tax-loss carry-forwards, will prevent companies from paying tax-exempt dividends from current income, so long as the use of those carry-forwards allows the company to avoid paying taxes.
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