Enthusiasm For Bank Stocks Quickly Wanes (C, KEY, STI, JPM, USB, WFC)
Just one trading day after bank stocks soared on some encouraging dividend news, enthusiasm for those headlines has apparently waned as the Money Center Bank Stocks Index is down 0.4%, a move that significantly lags the broader market today.
Citigroup (C), the bank that was on the receiving end of the largest taxpayer bailout, is down 2% despite reporting some surprising dividend news of its own. Citi CEO Vikram Pandit had previously said his company would not return capital to shareholders until next year, but the bank said today it will pay a dividend of a penny a share starting in the second quarter after a 10-for-1 reverse split of Citi shares on May 6.
A 1-cent quarterly dividend would produce an annualized dividend yield of 0.09% based on a reverse split conducted at the March 18 share price, giving Citi the third-lowest yield among S&P 500 dividend payers, according to Bloomberg News.
Regional bank KeyCorp (KEY) is lower by 1% after announcing on Friday that it will issue new shares to repay government bailout loans so that it can perhaps resume dividend payments. SunTrust Banks (STI) is flat after making a similar announcement on Friday.
Investors can track the Money Center Bank Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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