SunTrust Banks, based in Atlanta, received approval from the Federal Reserve Bank to double its dividend and buy back stock after passing the so-called stress test.
SunTrust plans to raise its dividend to 20 cents a share, beginning in the second quarter. It will repurchase up to $450 million of common stock in the next year and will maintain dividend payments on its preferred stock.
SunTrust Chairman and CEO William H. Rogers, Jr. said in a statement he was “pleased” the bank could move ahead with its plans. The Fed had no objections to SunTrust’s actions.
“We remain committed to driving further improvements in our business performance and delivering long-term value to our shareholders,” Rogers said.
Last year, SunTrust was able to double its dividend as well, to 10 cents a share, and was permitted to repurchase up to $200 million of common stock. In 2012, SunTrust failed the stress test and had to resubmit a plan that did not include a dividend increase or stock buyback.
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