Abstract

http://ssrn.com/abstract=1979501
 
 

References (37)



 
 

Citations (2)



 


 



Payout Policy Through the Financial Crisis: The Growth of Repurchases and the Resilience of Dividends


Eric Floyd


Rice University

Nan Li


University of Toronto - Rotman School of Management

Douglas J. Skinner


The University of Chicago - Booth School of Business

June 1, 2015

Journal of Financial Economics (JFE), Forthcoming
Chicago Booth Research Paper No. 12-01

Abstract:     
We compare the payout policies of US industrials and banks over the past 30 years to better understand dividends, especially for banks. For industrials, dividends grow strongly after 2002, when the declining propensity to pay reverses. Banks have a higher and more stable propensity to pay dividends and resist cutting dividends as the 2007-08 financial crisis begins. Before the crisis, increases in repurchases push payouts to historic levels. These findings are broadly consistent with the idea that banks use dividends to signal financial strength, while agency costs of free cash flow better explain industrial payouts.

Number of Pages in PDF File: 41

Keywords: Dividends, Repurchases, Dividend signaling, Banks

JEL Classification: G21, G28, G35


Open PDF in Browser Download This Paper

Date posted: January 5, 2012 ; Last revised: November 24, 2015

Suggested Citation

Floyd, Eric and Li, Nan and Skinner, Douglas J., Payout Policy Through the Financial Crisis: The Growth of Repurchases and the Resilience of Dividends (June 1, 2015). Journal of Financial Economics (JFE), Forthcoming; Chicago Booth Research Paper No. 12-01. Available at SSRN: http://ssrn.com/abstract=1979501 or http://dx.doi.org/10.2139/ssrn.1979501

Contact Information

Eric Floyd
Rice University ( email )
6100 South Main Street
Houston, TX 77005-1892
United States
Nan Li
University of Toronto - Rotman School of Management ( email )
105 St. George Street
Toronto, Ontario M5S 3E6
Canada
416-946-3126 (Phone)

Douglas J. Skinner (Contact Author)
The University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7137 (Phone)

Chicago Booth School of Business Logo

Feedback to SSRN


Paper statistics
Abstract Views: 7,790
Downloads: 2,382
Download Rank: 3,519
References:  37
Citations:  2

© 2016 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollobot1 in 0.313 seconds