Nearly all at once, it seems, a big group of banks declared dividend raises earlier this summer. That's because 23 major lenders in this country were subject to the Federal Reserve's latest annual stress test. All of them passed, meaning that they are capitalized adequately to withstand a relatively high degree of economic pressure.

With those passing grades slapped on their financials, more than a few were quick to hike their payouts. Let's look at two of the more notable bank dividend raises: those of the nation's second biggest bank, Bank of America (BAC -0.07%), and retail finance specialist Synchrony Financial (SYF -0.74%). Do these increases strengthen the buy case for either stock?

1. Bank of America

In mid-July, Bank of America declared that its next payout would be $0.24 per share, or 9% higher than before.

It would also yield nearly 3.1% based on the current share price; this is quite good for any stock becasue the average of the S&P 500 index stands at less than half that, at 1.5%. It's downright excellent for the finance sector, which has never been a hotbed of generous dividend payers.

Bank of America is a powerhouse atop the U.S. banking sector, and it continues to benefit from an expanding economy with slowing inflation, the top macroeconomic worry of recent months.

In its second quarter, it posted double-digit percentage growth in both revenue and profitability on a year-over-year basis. And for the 18th quarter in a row, it increased the number of checking accounts -- a major source of deposits from which it funds loans.

This is a lender that knows very well how to capitalize on an up cycle. Current signs indicate that our economy will stay on a growth path, although we're still not quite fully over the hump of inflation worries. Bank of America is a fine play on this country's continued success.

Happily, for yield seekers, there is still time to ride the company's dividend raise. The first $0.24 per share will be handed out on Sept. 29 to stockholders of record as of Sept. 1.

2. Synchrony Financial

The American banking sector is deep and wide; for proof, look no further than Synchrony Financial, a notably different institution from a traditional lender.

Synchrony focuses on consumer credit, specifically the provision and management of branded cards issued by retailers and other businesses. It is the entity behind plastic from American Eagle Outfitters, for example, and those of big companies in other corners of our economy such as eBay, Chevron, and Lyft.

Specializing in this niche has been profitable. Synchrony consistently books a bottom-line surplus; for example, its second-quarter net profit came in at $569 million on net interest income of $4.1 billion. While the profit figure was down notably from $804 million in the same period of 2022, this was due largely to higher provisioning for loan losses. It also topped the average analyst estimate, by the way.

Synchrony is riding a strong tailwind. As it stated in that second-quarter earnings release, consumers are reverting "to pre-pandemic norms." In other words, they're no longer reluctant to visit retailers and shop. On an adjusted basis, the purchase volume through Synchrony rose 6% in the quarter, while the number of average active accounts grew by 7%.

While a traditional financier like Bank of America offers wide exposure to borrowers nationwide, Synchrony is an attractive niche stock for those who believe the retail sector might outpace the broader economy. 

Last month, Synchrony hiked its quarterly payout to $0.25 per share from $0.23. This quarter's dividend is to be paid on Aug. 10 to investors of record as of July 31. Like Bank of America, Synchrony is a relative high yielder: The new amount has a theoretical 2.9% annual yield.