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Highlights
- On Thursday, November 5, Canada’s banking regulatory body lifted the pandemic-led ban that had halted dividends hikes for federally controlled banks.
- A bank stock mentioned here swelled by approximately 66 per cent over the last twelve months.
- Another Canadian bank notes a return on equity (ROE) of 18.68 per cent.
The Office of the Superintendent of Financial Institutions (OSFI), on Thursday, November 5, lifted the pandemic-led prohibition that had halted dividend hikes and share buybacks for federally controlled banks.
The banking regulator of Canada had restricted such capital distributions in March 2020 to tackle COVID-led financial risks.
As shareholders rejoice this development, let us discuss five Canadian banks listed on the TSX that investors can look into in the hopes on increased dividends.
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1. Royal Bank of Canada (TSX: RY)
The Royal Bank of Canada, popularly known as RBC, saw its stock close at C$ 132.51 apiece on Thursday, November 4, marking a daily increase of 0.257 per cent.
On a year-on-year basis, RBC’s stock price has expanded by nearly 45 per cent, while its year-to-date (YTD) return shot up by roughly 30 per cent.
Image source: © 2021 Kalkine Media Inc
The RBC held a return on equity (ROE) of 18.68 per cent at the time of writing this.
As for its dividend cycle, the lender is expected to pay C$ 1.08 per share as a quarterly dividend to its investors this month, on November 24.
2. Toronto-Dominion Bank (TSX: TD)
One of the biggest lenders in Canada, the Toronto-Dominion Bank saw its stock close trading at a price of C$ 91.28 per share on November 4, up by 0.176 per cent.
It clocked a one-year high of C$ 91.37 during this session.
TD’s stock price has risen by more than 22 per cent in the past nine months, while its one-year growth was more than 52 per cent.
The Toronto-Dominion Bank held an ROE of 17.67 per cent at the time of writing this.
3. Bank of Nova Scotia (TSX: BNS)
On November 4, global financial service firm Bank of Nova Scotia witnessed its stock close trading at a value of C$ 82.92 apiece, up by 0.072 per cent.
It was ranked among the top actively traded stocks, with a 10-day volume averaging at 3.2 million shares.
BNS stock surged by almost 19 per cent in the last nine months. Its stock price has also soared by nearly 47 per cent in the past twelve months, while marking a YTD gain of roughly 21 per cent.
At the time of writing this, it held a price-to-earnings (P/E) ratio of 11.5 and an ROE of 14.11 per cent.
4. Bank of Montreal (TSX: BMO)
North American financial service provider Bank of Montreal saw its stock hold a price of C$ 137.34 apiece at market close on November 4, up by 0.226 per cent.
BMO stock has jumped by more than six per cent in the last 30 days. In the last nine months, it has gained more than 40 per cent.
Its stock price swelled by approximately 66 per cent over the last year, while on a YTD basis, it expanded by nearly 42 per cent. Its ROE stood at 13.30 per cent on November 5.
The Bank of Montreal is set to dole out C$ 1.06 per share as a quarterly dividend to its shareholders on November 26.
5. Canadian Imperial Bank of Commerce (TSX:CM)
The Canadian Imperial Bank of Commerce, which is also considered to be one of the largest lenders in the country, saw its stock close at C$ 149.91 apiece on November 4.
During this session, it hit a 52-week high of C$ 152.87.
CM stock has climbed by about four per cent in the past month and expanded by more than 15 per cent in the last six months.
While it grew by more than 46 per cent YoY, its YTD return was nearly 38 per cent.
Also read: Sleep Country (TSX:ZZZ) stock rises on acquisition news. A buy?
Bottom line
Some market experts believe that the top banks in Canada are likely to post a significant increase in their dividend disbursements now that the prohibition is lifted. This is likely to make bank stocks popular among investors.
However, investing risk can be a daunting factor for big banks as well. Thus, investors should research about top lenders as well to take accurate and timely decisions.
