PNC Financial Rewards Shareholders With a 6% Dividend Hike

The PNC Financial Services Group, Inc. PNC hiked its quarterly cash dividend by 6% from the prior payout to $1.70 per share. The dividend will be paid out on Aug. 5, 2025, to shareholders of record as of July 15, 2025.

This dividend increase move came after the company cleared the Federal Reserve’s 2025 stress test. Under the Fed’s 2025 Supervisory Severely Adverse scenario, PNC’s post-stress capital ratios are expected to stay well above regulatory requirements, with a minimum projected CET1 ratio of 9.7% and an ending CET1 ratio of 9.8%, compared to the regulatory minimum of 4.5%.

Prior to this hike, PNC raised its dividend by 3% to $1.60 per share in July 2024. It has a five-year annualized dividend growth rate of 8.49%. At present, its payout ratio is 45% of its earnings.

Based on its closing price of $196.57 as of July 3, 2025, PNC’s current dividend yield is 3.26%, well above the industry average of 1.87%.

Dividend Yield

William S. Demchak, chairman and CEO of PNC, stated that, “The increase in our dividend reflects our continued financial strength and our board's confidence in our strategy and outlook.”

PNC's Other Capital Distribution Actions

Apart from dividends, PNC also has a share repurchase program in place. In the second quarter of 2022, a 100 million share repurchase plan was authorized. As of March 31, 2025, 40.5 million shares were available for repurchase under the authorization. Furthermore, the company anticipates maintaining a similar share repurchase level in the upcoming quarters of 2025.

The company also enjoys a decent liquidity position. As of March 31, 2025, PNC had $38.4 billion in total available liquidity, comprising cash and interest-earning deposits at banks. However, its total borrowed funds (comprising of Federal Home Loan Bank advances, senior and subordinated debt, and other borrowings) were higher at $60.7 billion as of the same date.

Given its decent liquidity profile and strong capital position, PNC’s capital distribution activities seem sustainable.

PNC’s Zacks Rank & Price Performance

Shares of PNC have gained 23.7% over the past year, outperforming the industry’s growth of 41.1%.

Price Performance

At present, PNC carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Banks That Announced Dividend Hike Plan

Post-clearing the 2025 Fed stress test, Wells Fargo & Company WFC and Citigroup Inc. C announced their plans to raise the quarterly dividend.

WFC plans to raise dividends by 12.5% to 45 cents per share for the third quarter of 2025, while C plans to increase its dividend by 7% to 60 cents per share, beginning the third quarter of 2025. 

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This article originally published on Zacks Investment Research (zacks.com).

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