The global dividend payouts to shareholders reached an all-time high of $1.66 trillion in 2023, as reported by British asset manager Janus Henderson. This represents a 5% increase year-on-year, with a 7.2% rise in the fourth quarter compared to the previous three months. The underlying basis of this growth accounts for the impact of exchange rates, special dividends, technical factors related to dividend calendars, and changes to the index.
The banking sector played a significant role in driving the world’s total dividend growth, contributing nearly half of the increase. Record payouts were attributed to high-interest rates that boosted lenders’ margins. Major banks like JPMorgan Chase, Wells Fargo, and Morgan Stanley announced plans to raise their quarterly dividends after clearing the Federal Reserve’s annual stress test, indicating a positive trend in the industry. However, the banking-sector’s dividend boom was not experienced by Chinese banks, creating a disparity in global dividend growth.
While the banking sector saw substantial dividend growth, the mining sector experienced significant cuts in payouts. Major companies such as BHP, Petrobras, Rio Tinto, Intel, and AT&T made large dividend cuts, leading to a two-percentage-point decrease in the global underlying growth rate for the year. Despite these setbacks, there was still broad-based growth in many parts of the world, with 86% of listed companies either increasing dividends or maintaining them at current levels.
Several countries, including the U.S., France, Germany, Italy, Canada, Mexico, and Indonesia, witnessed record payouts in 2023. Europe emerged as a key engine of growth, with dividend payouts rising by 10.4% year-on-year on an underlying basis. The region’s strong performance contributed significantly to the overall increase in global dividend payouts. Looking ahead to 2024, Janus Henderson forecasts total dividends to reach $1.72 trillion, representing a 5% underlying growth rate.
The global dividend landscape is evolving, with the banking sector driving growth while the mining sector faces challenges. Regional disparities and sector-specific trends contribute to the overall dynamics of global dividend payouts. As companies navigate economic uncertainties and market conditions, the dividend landscape is likely to witness further shifts in the coming years.