Dividends

The Federal Reserve is urging Wells Fargo & Co. and dozens of banks getting bailout funds to consider future loan losses and the need to bolster capital before paying dividends to shareholders. The Fed told its regional supervisors in a letter that banks should reduce or eliminate dividends when earnings decline or the economic outlook deteriorates. The guidance may signal that some banks resisted dividend cuts even as regulators grew increasingly concerned about their ability to withstand losses, said Sherrill Shaffer, who served as the New York Fed's chief economist in the 1980s.

Tribune Co.'s newspaper unit will pay a dividend of up to $275 million to its parent when it is spun off later this year, according to a government filing. The new Tribune Publishing Co. will own the Los Angeles Times and seven other newspapers. Shares of the company will trade on the New York Stock Exchange under the ticker symbol TPUB. Details about the dividend were made public in a lengthy filing with the Securities and Exchange Commission submitted late Friday. The dividend has sparked opposition from critics who say it would weigh on the company at a time of diminishing advertising revenue and intensifying digital competition.

U.S. companies are boosting dividend payments at a steady clip, a boon for investors who are drawn to the regular cash payments Corporate America paid out $24.2 billion in dividends in the first quarter, a nearly 28% rise over the $19 billion shelled out in the the first quarter of 2011, according to Standard & Poor's Corp. This year, 677 companies have raised their payouts, a jump of nearly one-third from the 510 that did so a year ago. Only 31 companies have slashed their payouts this year.

WASHINGTON - Federal regulators rejected plans by Citigroup Inc. and four other large U.S. banks for dividend payments and stock buybacks after the latest round of stress tests. The results raised concerns about weaknesses in the risk-planning processes of Citi and three of the banks, the Federal Reserve said Wednesday. It was the second time in three years that Citi failed a federal stress test. Citi's chief executive, Michael Corbat, said he was "deeply disappointed" by the Fed's findings, asserting that the nation's third-largest bank by assets was "one of the best-capitalized financial institutions in the world.

The Obama administration has reached a preliminary agreement with BP executives that would see the oil company pay $20 billion over several years into an independently controlled escrow account to be established to compensate Gulf of Mexico residents affected by the disastrous oil spill, and BP's board of directors has eliminated the company's stock dividend, at least temporarily. The agreement on the escrow account was negotiated in a meeting at the White House on Wednesday morning, the first face-to-face gathering between President Obama and senior BP leadership.

Sunstone Hotel Investors, Inc. announced that it is increasing the quarterly dividend from 23 cents a share to 25 cents a share, payable Nov. 15 to shareholders of record Nov. 1. Sunstone, a real estate investment trust, owns 20 hotels in the West.

Apple Inc. announced that Chief Executive Tim Cook would be passing up on $75 million by not participating in the Cupertino, Calif., company's quarterly dividends. With the company set to start giving out a quarterly dividend of $2.65 a share by the fourth quarter of this year, Cook decided not to collect the dividends for his 1.125 million shares, which would amount to $75 million before they each vested. Cook's decision to decline the payments was announced Thursday by the company through an SEC filing.

NEW YORK - Hoping to save shareholders money, Costco joined a growing list of companies issuing dividend payments this year, rather than waiting and seeing if tax rates rise as Congress wrangles over the "fiscal cliff. " The warehouse retailer said Wednesday that it would pay shareholders a special dividend of $7 a share before the end of the calendar year, "our latest effort in returning capital to our shareholders," said Chief Financial Officer Richard Galanti. Dividends, which are profits made from investing in stocks and bonds, are currently taxed at a rate of 15% for the top four tax brackets, and 0% for the bottom bracket.

The number of companies raising cash dividend payments to shareholders jumped last year, reversing a five-year trend of greater corporate stinginess. The turnaround comes as the Bush administration is said to be planning a proposal to cut taxes on dividend income. That could put more pressure on firms to directly share profits with stockholders via higher dividends. A total of 1,425 companies raised dividend payments last year, up 7.

More companies raised dividend payments in February than a year earlier, but the pace of improvement in the trend slowed from recent months, Standard & Poor's said Monday. A total of 158 companies boosted their cash dividend payments, up from 151 in February 2002, S&P said. That was the seventh year-over-year increase in eight months, but it was less impressive than in January, when 197 companies raised dividends compared with 170 a year earlier.

In spinning off its publishing business, Tribune Co. will pick up a dividend that could be about $325 million from the new public company, which would consist of the Los Angeles Times, the Chicago Tribune and six other daily newspapers. Although the exact amount won't be determined until the separation agreement is final, expected in midyear, Tribune has indicated that the dividend it would receive from Tribune Publishing Co. would be worth about $325 million. That figure is contained in a document related to Tribune's purchase in December of a group of television stations.

WASHINGTON - Federal officials swooped in to rescue mortgage finance giants Fannie Mae and Freddie Mac in 2008 with the largest of all the financial crisis bailouts - a combined $187.5 billion - because they were considered too big to fail. Now, despite bipartisan support to shut them down, Fannie and Freddie may prove to be too profitable to close. Fannie and Freddie play a vital role in the mortgage market by purchasing or guaranteeing more than 6 in 10 new loans. And the housing market's recovery has reversed the finances of the once-private companies, now wards of the U.S. government.

On Dec. 1, 1948 - 65 years ago this month - Jose Figueres, then president of Costa Rica, made a fiery and eloquent speech, after which he took a sledgehammer and bashed a hole in a huge stone wall at the nation's military headquarters, Cuartel Bellavista. Its imposing towers and massive gates had loomed over the capital city of San Jose since 1917, the country's premier symbol of military power and the home of the "Tico" military establishment. Figueres was not just being a showman; he was announcing something truly extraordinary: Henceforth, Costa Rica would take the almost unheard-of step of renouncing its military.

WASHINGTON - More than five years after the government seized Fannie Mae and Freddie Mac, taxpayers are close to breaking even on the controversial bailouts of the mortgage finance giants. The companies said Thursday that they would make another set of large dividend payments to the Treasury after reporting third-quarter profits, continuing a turnaround fueled by the housing market rebound. Combined, the companies have received about $187.5 billion in bailout money, though none since early 2012.

Five years after Washington bailed out more than 700 banks, the money has become a burden for more than 100 community banks that can't seem to repay it. About a dozen of those are in California, and they are facing increasing pressure as the federal government looks to close out the Troubled Asset Relief Program, or TARP. The banks will soon face a big increase in the annual dividend they must pay the government on its investment - to 9% from 5%. Some of the banks will have to sell out or bring in new shareholders - who might demand control of the institution in exchange for the cash infusion.

It started as a social club, a way for a bunch of Westside workaholics to carve out time for fun while doing a few good deeds on the side. As comfortable alums of prestigious schools, with satisfying careers, they wanted their friendship to become a lever of social change. "We were part of that generation in the '60s and '70s where social causes based on race and poverty came to the forefront," recalled investment banker Rob Deutschman. "We were all exposed to the civil rights movement, to Vietnam, to the campaigns against poverty in urban America.

Dynegy Inc. said it would not pay dividends in the third quarter and has no plans to reinstate them "in the near term." The Houston-based energy marketer said in a filing with the Securities and Exchange Commission that its board of directors elected to suspend dividends to focus on the company's plan to raise $2 billion to strengthen finances and improve its image on Wall Street. Dynegy said when the plan was unveiled in June that dividends would be cut in half.

Fewer U.S. companies raised cash dividend payments to shareholders in August than in the same month a year earlier, suggesting that some chief executives turned wary about parting with corporate savings. A total of 118 companies increased their dividends last month, down 24% from 155 in August 2003, according to research firm Standard & Poor's. Dividend increases also were lower in July than a year earlier. The last two months mark a change from the trend of the previous year.

Sinking money into real estate investment trusts is considered to be one of Wall Street's most complex investments. Owning shares of REITs gives investors an opportunity to get investment exposure to real estate, including apartments, shopping centers and office buildings. But they've gained a reputation of being risky and confusing - especially after the industry was pummeled during the last real estate crash. Even Lloyd McAdams, chief executive of Anworth Mortgage Asset Corp., makes no bones about saying his Santa Monica REIT does carry some risk.