On 13th September 2022, the Swiss bank UBS announced a dividend increase and stock buyback plan. Read
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Question:
On 13th September 2022, the Swiss bank UBS announced a dividend increase and stock buyback plan. Read the following excerpts from an article on Financial Times and answer the questions.
a. On the announcement of the plan, "UBS shares rose 1 per cent in early trading on Tuesday". Use signalling to explain this market response for both the buyback and dividend increase.
b. To payout the earnings, UBS is using both the cash dividend and share buyback. Compare these two forms of payout for UBS.
c. What is the implication of this increased payout on UBS managers' incentive?
Related Book For
Financial Reporting and Analysis
ISBN: 978-1259722653
7th edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
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