City National Corporation
) increased its common stock dividend payable in the fourth
quarter of 2012 by virtue of a special dividend announced for
shareholders. Along with the regular quarterly common stock
dividend of 25 cents per share, the company made an announcement
of a special dividend of 25 cents to be paid in the fourth
FRANKLIN RESOUR (BEN): Free Stock Analysis
CITY NATIONAL (CYN): Free Stock Analysis
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These dividends, which summed to 50 cents per share, will be paid
on December 18 to shareholders of record as of December 3. Yet,
the company's third-quarter dividend announced on October 18 will
be paid on November 21, 2012.
The special dividend is part of City National Corporation's
long-term strategy to enhance shareholder value through prudent
capital management. The strategy also includes investment in
profitable businesses while sustaining financial stability and
Previously, City National Corporation bolstered its dividend by
25% (from 20 cents to 25 cents per share) in January 2012,
reflecting the company's commitment to return value to
shareholders with its strong cash generation capabilities.
Based in Los Angeles, California, City National Corporation
operates as the bank holding company for City National Bank. With
$26.3 billion in total assets, the company provides various
banking products and services through 78 offices in Southern
California, the San Francisco Bay Area, Nevada, New York City,
Nashville and Atlanta.
In October, City National Corporation reported its third quarter
2012 earnings of $1.10 per share, exceeding the Zacks Consensus
Estimate of 92 cents. This compared favorably with the
prior-quarter earnings of 77 cents. City National Corporation's
better-than-expected results benefited from the augmentation in
non-interest income and net interest income. However, these
positives were partially offset by a rise in operating expenses.
The company paid roughly $40 million in dividends to common
shareholders for the nine months ended September 30, 2012. Cash
and due from banks exiting the third quarter of 2012 was $235
Based on the company's capital strength and positive earnings,
this special dividend declaration is expected to boost investors'
confidence in the company. Moreover, the recently completed
acquisition of Rochdale is expected to strengthen its financial
results. However, the regulatory restrictions and sluggish
economic recovery could mar the growth and increase costs.
City National Corporation currently retains a Zacks #2 Rank,
which translates into a short-term Buy rating. We believe the
announcement of special dividend will be an appropriate step for
the company in boosting shareholders' confidence, which might
lead to positive estimate revisions. This, in turn, could cause
an improvement in the Zacks Rank.
Among others, California-based
Franklin Resources Inc.
), a global investment management company, also announced a
special cash dividend of $3.00 per share, which will be paid on
December 20, 2012 to stockholders of record as on December 6.