Wall Street investment bank Moelis (NYSE:MC) cut its dividend in half for the second quarter due to uncertainty related to the coronavirus pandemic.

In its first-quarter earnings report, Moelis reduced its dividend from $0.51 to $0.25, effective May 4. Officials said it's prudent to retain capital to enhance financial flexibility in this uncertain environment. The company had been paying out a high dividend at a yield rate of nearly 7%. Now the yield rate is about half that. It is the first time the company has lowered its quarterly dividend dating back to 2014.

"In the current unprecedented environment, the emphasis on balance sheets and business models are now at the forefront of conversations across all companies. However, for Moelis & Company, building and maintaining a fortress balance sheet has been at the core of our business since inception," said Ken Moelis, the company's founder, chairman, and CEO. 

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Moelis's stock price dropped about 6% on the news. However, it has outperformed the S&P 500 in 2020, down about 9% on the year. The company got a boost earlier this month when Treasury Secretary Steven Mnuchin announced that Moelis was one of three banks picked to advise the government on distributing relief funds to the airlines as part of the $2.2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act. 

The company had a solid quarter, with revenue up 12% year over year to $153.7 million and net income up 86% to $30.1 million. Diluted earnings per share increased 76% to $0.44 in the quarter.

"In addition to our strong financial position, we have built a resilient advisory business that is designed to perform in all economic cycles," Moelis said.