Dividend Stocks: Big Banks Boost Payouts, Plus a Dozen More Yield Increases

Dividend stocks news:  The big dividend news last week came from the banking sector on the heels of the U.S. Federal Reserve's stress test.

The test is aimed at ensuring big banks can handle a steep slump like the 2008 financial crisis and continue operations without a government bailout. In total, 25 banks passed the central bank's test, while five failed.

The following 10 banks passed the stress test and are permitted to increase dividend payouts. And increase payouts they did:

American Express Co. (NYSE: AXP) lifted its quarterly dividend $0.03, or 13%, to $0.26 a share. The credit card company catering to the elite also said it would buy back as much as $4.4 billion of its stock this year and some $1 billion next year. Shares yield 1.1%.

Bank of America Corp. (NYSE: BAC) received approval to increase its quarterly dividend a penny to $0.05 per share. The hike gives shares a 1.2% yield. BofA also announced a $4 billion stock buyback program.

Bank of New York Mellon Corp. (NYSE: BK) received an okay to sweeten its quarterly payout 13%, or $0.02, to $0.17 a share. Additionally, the bank will buy back $1.7 billion of its stock through Q1 of 2015. Shares yield 1.9%.

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JP Morgan Chase & Co. (NYSE: JPM) got the nod to raise its quarterly dividend $0.02 to $0.40 a share. JPM also said it would buy back $6.5 billion in stock over the next year. The payout increase gives JPM stock a 2.7% yield.

Morgan Stanley (NYE: MS) shareholders got a nice boost. The bank was permitted to double its quarterly dividend to $0.10 a share and was also approved to commence a $1 billion stock repurchase. Shares yield 1.3%.