JPMorgan (JPM) Sees Restoring Dividend Payout to 30-40% of Normalized, to Focus on Organic Growth, Share Repurchases After That

September 14, 2010 11:38 AM EDT
Ahead of its presentation at the Barclays Capital Financial Services Conference, JPMorgan (NYSE: JPM) is making some comments related to Basel III, the Volcker Rule, Reg E and the effects of the debit interchange reform.

First off, the firm says that it will not need to issue stock in accordance with Basel III and that it will likely not operate with an added self-imposed buffer. Related to the Volcker Rule, JPMorgan argues that the plan does not effectively limit client business growth.

In regards to the Card act, JPMorgan sees net income effect of plus or minus $750 million and also sees its Chase card service loss around plus or minus 8% during Q3.

Finally, and likely most important to shareholders, JPMorgan forecasts that it will restore its dividend payout ratio to about 30-40% of its normalized dividend. The firm adds that if/when the dividend is restored, it could use further cash to invest in organic growth or a stock buyback program.


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