By William Hamilton
PBN Staff Writer
WATERBURY, Conn. – Webster Financial Corp., the holding company for Webster Bank, has raised its stock dividend to 5 cents per share from the 1 cent-per-share dividend it has paid to shareholders in recent quarters.
“Giving consideration to Webster’s strong capital position and consistently improving operating performance, the board is pleased to announce an increase in the cash dividend,” said James C. Smith, Webster’s chairman and CEO. “The board will consider further increases in the dividend based on future performance and capital needs.”
Webster recently reported first quarter earnings of $33.5 million, significantly better than the $6.07 million loss posted in the same quarter a year earlier.
Generally, publicly owned companies increase dividends – a distribution of profits to the ultimate owners of the company – when they are comfortable with the financial condition of the firm. When a company is struggling, dividends are frequently withheld so the company can retain capital.
Webster had cut its dividend severely during the turmoil in the financial markets.
The larger dividend on common shares will be payable on May 23 to shareholders of record on May 9.
Webster also declared a regular quarterly cash dividend of $21.25 per share on its 8.50 percent Series A Non-Cumulative Perpetual Convertible Preferred Stock, payable on June 15, to shareholders of record on June 1.