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Will These Banking Investors See a Dividend Pop This Week?

By David Hanson and Matt Koppenheffer – Mar 25, 2014 at 9:00AM

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Many investors were very confident that several of the big banks would come through the stress tests strong, and ready to initiate bigger dividends and share buybacks. Is that now in jeopardy?

Many big bank investors have been watching the news from the banking stress tests closely, hoping to see outstanding performances from banks such as Bank of America (BAC -1.29%) or JPMorgan Chase (JPM -0.30%) that may indicate these banks will be permitted to raise dividends and initiate share buyback programs. But after the first round of stress test results from the Dodd-Frank stress tests last week, some of the confidence in that idea has been shaken. This is particularly true around Bank of America with its famously low dividend, which has seen a lot of expectations surrounding a dividend raise in recent weeks. Could Bank of America's stock take a hit if this coming round of CCAR stress test results this week don't permit the kind of dividend raise investors were hoping for?

In this segment from Monday's Where the Money Is, Motley Fool financial analysts Matt Koppenheffer and David Hanson look ahead to the coming CCAR stress test results later this week, as well as some of the other big numbers coming out over the next few days like the Case-Shiller Home Price Index, and last month's new home sales.

David Hanson owns shares of JPMorgan Chase. Matt Koppenheffer owns shares of Bank of America, Citigroup, and JPMorgan Chase. The Motley Fool recommends Bank of America. The Motley Fool owns shares of Bank of America, Citigroup, and JPMorgan Chase. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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