Bank Stocks with +3% Dividend Yields

Banks traditionally have been one of the best sectors for finding dividend-paying stocks. The five largest banks in the country all pay dividends and trade with yields comparable to U.S. Treasuries or other fixed-income securities:

Citigroup (C) 4.09% yield
Bank of America (BAC) 4.49% yield
JP Morgan Chase (JPM) 3.03% yield
Wachovia (WB) 4.26% yield
Wells Fargo (WFC) 3.13% yield

Bank stocks have showed less volatility than other sectors while maintaining a history of rewarding shareholders. Banks on average distribute close to 50% of their profits in dividends and another 20% in stock repurchase programs. In addition, banks generally trade at a lower multiple to future earnings than the S&P 500, NASDAQ, or Dow Jones Industrial Average as a whole. The stocks for the five largest banks in the country (listed above) all trade with a Price-to-Earnings ratio of less than 15:

Citigroup (C) 12.67 p/e
Bank of America (BAC) 10.4 p/e
JP Morgan Chase (JPM) 11.6 p/e
Wachovia (WB) 11.1 p/e
Wells Fargo (WFC) 14.4 p/e

Other banks with attractive dividend yields and Price-to-Earnings ratios of below 25 include:

Key Corp (KEY) - 4.30% yield, 11.55 p/e
Washington Mutual - (WM)5.16% yield, 13.88 p/e
National City (NCC) - 4.91% yield, 9.60 p/e
US Bancorp (USB) - 4.85% yield, 12.63 p/e
Fulton Financial (FULT) - 4.08% yield, 14.04 p/e
Fifth Third Bancorp (FITB) - 4.13% yield, 19.21 p/e
New York Community Bancorp(NYB) - 5.60% yield, 22.88 p/e

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