In an effort to further enhance stockholder value, Associated Banc-Corp (ASBC) announced a 12.5% hike in its quarterly cash dividend. The company declared a dividend of 9 cents per share to be paid on Dec 16 to shareholders of record as of Dec 2.
Prior to this, Associated Banc-Corp raised its quarterly cash dividend twice since the financial crisis. In Feb 2012, the dividend was raised by 400% to 5 cents per share from 1 cent, while in Nov 2012 it was further hiked by 60% to 8 cents.
However, back in 2008, the financial crisis severely hampered Associated Banc-Corp’s performance, inducing an 84.3% dividend cut to 5 cents from 32 cents. Following this, the dividend was slashed to a penny when the company suffered losses worth almost $181 million in 2010 owing to bad loans.
Apart from regular dividend payments, Associated Banc-Corp has a share repurchase policy in place. In Jul 2013, the company announced a new share repurchase authorization worth up to $120.0 million, subject to certain regulatory approvals. Earlier, in Nov 2012, the company’s board of directors authorized share repurchases worth up to $125.0 million.
Over the nine months ended Sep 30, 2013, Associated Banc-Corp bought back 5.9 million shares worth $90 million. Moreover, earlier this month, the company initiated an additional accelerated repurchase of 1.8 million shares.
The company’s steady capital deployment program reflects its capital strength. As of Sep 30, 2013, Tier 1 risk-based capital ratio was 12.02%, and Tier 1 common equity ratio was 11.64%. Also, the company’s cash and due from banks stood at $526 million as of that day.
Among others in banking sector, International Bancshares Corp. (IBOC) announced a hike in its semi-annual cash dividend in Sep 2013. The company raised its dividend by 15% to 23 cents per share.
Associated Banc-Corp currently carries a Zacks Rank #3 (Hold). However, better-performing banking stocks in the Mid-West region include Private Bancorp Inc. (PVTB) and Tower Financial Corp. (TOFC), both carrying a Zacks Rank #1 (Strong Buy).