Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, USA, March 5, 2024.
Brendan Mcdermid | Reuters
LONDON – Global dividend payouts to shareholders reached a record $1.66 trillion in 2023, according to a new report from British asset manager Janus Henderson.
According to the Global Dividend Index report released on Wednesday, distributions rose 5% year-over-year on an adjusted basis, with the fourth quarter showing a 7.2% increase compared to the previous three months.
The underlying figure takes into account the impact of foreign exchange rates, one-time special dividends and technical factors related to dividend calendars as well as changes to the index.
The banking sector contributed nearly half of the world’s total dividend growth and delivered record payouts as high interest rates boosted lenders’ margins, the report said.
Last year, major banks such as JPMorgan Chase, Wells Fargo and Morgan Stanley announced plans to increase their quarterly dividends after passing the Federal Reserve’s annual stress test, which dictates how much capital banks can return to shareholders.
“In addition, continued catch-up effects following the pandemic resulted in payouts being fully restored, particularly at HSBCJanus Henderson’s report added.
“Emerging market banks made a particularly strong contribution to the increase, although banks in China did not participate in the banking sector’s dividend boom.”
However, according to Janus Henderson, the positive impact of bank dividends was “almost entirely offset by cuts in the mining sector.”
The report found that some large companies have made large dividend cuts, such as: BHP, Petrobras, Rio Tinto, Intel And AT&T This diluted the underlying global growth rate for the year by two percentage points and masked significant, broad-based growth in many parts of the world.
“Key engine of growth”
Around 86% of listed companies worldwide have either increased their dividends in 2023 or maintained them at current levels, Janus Henderson said.
A total of 22 countries, including the United States, France, Germany, Italy, Canada, Mexico and Indonesia, recorded record payouts last year.
Europe was described as the “key growth engine”, with distributions rising 10.4% year-on-year on an underlying basis.
For 2024, Janus Henderson expects a total dividend of $1.72 trillion, representing underlying growth of 5%.
—CNBC’s Hugh Son contributed to this report.
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2024-03-13 00:01:01
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