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Bank of America Corp Quintuples Its Dividend

By Matt Koppenheffer and David Hanson - Mar 27, 2014 at 6:28PM

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Bank of America passes the Fed's CCAR analysis, and bumps its famous one-penny dividend up to five cents.

The results of the Fed's Comprehensive Capital Analysis and Review, or CCAR, round of stress tests are out, and Bank of America ( BAC -2.27% ) has officially been given the go-ahead to bump up its dividend, and initiate a share repurchase program.

The test, which includes three different scenarios at varying levels of crisis severity to show how each bank would fare if another crisis were to occur, showed that at the very worst level, Bank of America's numbers didn't look great, forcing the bank to scale back the dividend and share repurchase programs that it wanted.

However, it was still granted a non-objection to $4 billion in share repurchases, and an increase in its quarterly dividend from one cent to five cents, for a total of $0.20 per share per year.

In this segment of Thursday's Where the Money Is, Motley Fool banking analysts Matt Koppenheffer and David Hanson take a look at Bank of America today.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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