State Street Raises Dividend By 10% Following Stress Test Results

State Street Corporation STT announced dividend raise following the release of the Federal Reserve's preliminary stress capital buffer (SCB) results. 

The company boosted its dividend per share by 10% to $0.69 in Q3, subject to consideration and approval by its Board of Directors.

Also, STT plans to continue the share buyback program under its existing authorization for up to $4.5 billion in 2023.

"The latest CCAR results reinforce our strategy and confirm the resiliency and strength of our franchise, which enable us to support our clients and deliver for our shareholders. As we continue to repurchase our stock this year, we are pleased to announce another planned increase to our quarterly common dividend, in line with our goal of returning meaningful capital to our shareholders," said Chairman and CEO, Ron O'Hanley.

On June 28, the Federal Reserve notified the company that its preliminary Stress Capital Buffer (SCB) requirement would remain at 2.5%, equivalent to the regulatory floor, effective October 1, 2023.

STT's calculated SCB was well below the 2.5% minimum, maintaining its common equity tier 1 (CET1) ratio requirement at 8%.

In April, STT reported Q1 revenues of $3.10 billion, up 1% Y/Y, missing the consensus estimate of $3.12 billion, and EPS of $1.52 missed the consensus estimate of $1.64.

Price Action: STT shares closed at $73.18 on Friday.