S&P dividends expected to drop 13.3%

Dividends of companies in the Standard & Poor’s 500 stock index this year are expected to see their sharpest annual decline since World War II, New York-based S&P said today. Those dividends are expected to decline 13.3%, the worst annual decline since 1942 when they dropped 16.9%. “Given the current economic climate and growing concern over dividend cuts, dividend increases for the S&P 500 companies are expected to slow in 2009,” Howard Silverblatt, senior index analyst at Standard & Poor’s, said in a statement. “Unless companies believe that their financial future will improve, their need to conserve cash will outweigh their desire to pay dividends.” The $24.60 dividend rate translates into an expected $214.66 billion in payments for S&P 500 companies in 2009 versus the $28.39, or $247.9 billion, paid in 2008, the company said.