Investors in FTSE 350 companies look set to enjoy a record level of dividend payouts over the next few months, according to the latest research.
IHS Markit estimated that dividends will see a year-on-year increase of 25 per cent, totalling £20.7bn in the second quarter of 2017.
Dividend payouts to UK investors will be bolstered by the relative weakness of the pound against the dollar, with a third of the predicted payments determined in dollars.
“Bank payouts are now up 17 per cent thanks to the stronger US dollar,” the report stated.
IHS Markit pointed out that HSBC will be the only bank to declare a dividend this quarter and plans on sustaining the annual dividend at the current level for the foreseeable future.
Utility stocks are to expected account for a quarter of the total dividend payout across the FTSE 350, which has largely been helped by the National Grid dishing out a special dividend totalling £3bn as it sells off its £14bn gas pipes business.
Ordinary dividends across FTSE 350 companies are also expected to hit £17.4bn, which is a rise of 9 per cent, according to the report.
According to the report, 25 stocks have a yield above 5.7 per cent, of which 10 are part of the FTSE 100 index.
The media sector is set to see a 76 per cent boost this quarter, while retail, travel and leisure is expected to disappoint.
katherine.denham@ft.com
