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Soft results show bank dividends aren't bulletproof

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For retirees and other investors in search of a big dividends — and franking credits — it has been hard to go past the big banks.

The major banks make up four of the top-six domestic shares held by do-it-yourself super funds, with Westpac the most widely held stock, according to Class, a Self Managed Super Fund software business.

NAB cut its dividend this month, and some expect Westpac will follow suit.Credit:Karl Hilzinger

Lately, however, these investors have been given a few reasons to think more carefully about "set and forget" investments in the big four.

One risk hanging over the entire sector is the impact of Labor's plan to scrap refunds on excess franking credits, if elected this weekend.

Given the popularity of bank shares in SMSFs, Citi analysts predicted earlier this year that the policy change could wipe tens of billions of dollars off the combined share market value of the big four banks, and some of that has probably already been "priced in" by the market.

This month's round of........

© The Age