Wells Fargo constructing in San Francisco.
Source: CNBC
Wells Fargo shares popped Tuesday after the bank said it might buy back $30 billion in stock.
The corporate also said its board of directors approved a previously announced dividend increase, to 35 cents per share from the previous 30 cents. The sum is payable on Sept. 1 to shareholders of record on Aug. 4.
Wells Fargo’s stock rose greater than 3% in prolonged trading Tuesday.
The moves come after the bank beat second-quarter earnings and revenue expectations, driven by a 29% increase in net interest income. A flurry of rate increases by the Federal Reserve since last yr has boosted key financial institutions — as borrowers face a bigger interest burden.
The central bank is predicted to hike rates again Wednesday because it tries to rein in elevated inflation.
Democratic lawmakers have introduced multiple bills that aim to curb stock buybacks by major corporations. They are saying the companies are passing profits on to wealthier shareholders as a substitute of accelerating their employees’ pay.
The most important U.S. banks have announced plans to boost their quarterly dividends after they cleared the Federal Reserve’s annual stress test last month.
“Even with these significant investments, our capital levels are strong and we expect them to stay so, allowing us to return excess capital to our shareholders,” Wells Fargo CEO Charlie Scharf said in a press release accompanying the bank’s announcement.
