Goldman Sachs plans to raise quarterly dividend 33%, sees SCB at 3.4%

On Friday, June 27, the Federal Reserve released the results of its 2025 Comprehensive Capital Analysis and Review stress test process. Goldman Sachs (GS) expects the firm’s Stress Capital Buffer requirement will be 3.4%, resulting in a Standardized Common Equity Tier 1 ratio requirement of 10.9%, effective October 1. The Federal Reserve will provide the firm’s final SCB requirement by August 31. These results and effective date may be subject to further changes pending the finalization of the Federal Reserve’s outstanding proposal on SCB averaging. In addition, the Federal Reserve disclosed that the firm’s current SCB, from the CCAR 2024 test, has been reduced by 10 basis points to 6.1%. This results in a current CET1 ratio requirement of 13.6%, effective immediately. The firm’s capital plan includes a 33% increase in the common stock dividend from $3.00 to $4.00 per share beginning July 1, 2025, subject to approval by the firm’s Board of Directors at the customary third quarter meeting. This increase is a continuation of the firm’s plan to pay shareholders a sustainable and growing dividend.