The surge in global interest rates meant banks contributed half the world’s dividend growth
Companies around the world are on track to pay investors a record $1.64 trillion in dividends this year following a more than 6% jump in the second quarter, a report on Wednesday showed.
Dividends were up nearly 10% to $184.5 billion. That did not including Britain, where the quarterly total dropped to $30.7 billion from last year’s $34.9 billion, when oil and gas firms saw a leap in payments after Russia’s invasion of Ukraine sent commodity prices surging. “A weaker economic environment is typically negative for banks,” Lofthouse said. “But the positive effect on bank margins from the end of years of ultra-low interest rates is very powerful and is driving dividend payouts”.
Healthcare companies helped the growth, led by UnitedHealth Group and Eli Lilly, both of which have posted strong profits and raised guidance for the rest of the year. In Asia the picture was mixed. The second quarter marks a seasonal high point for Japanese dividends and payouts there rose 8.4% on an underlying basis.