By now, most ASX investors would know that the S&P/ASX 200 Index (ASX: XJO) has enjoyed a pretty successful year in 2021 so far. The ASX 200 is now up roughly 9.6% year to date (as of Friday's market close). But what might be a little more surprising for most investors is how much better the Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price has performed over the year.
Year to date, ANZ shares are up a very robust 23.96%. That's more than double the broader market.
So what's behind this surprising outperformance?
Well, to understand that, let's go back to last year. 2020 was a shocking year for ANZ shares. This ASX bank ended up going backwards over the calendar year by approximately 11.8%. In stark contrast, the ASX 200 ended up losing just 1.45% in 2020.
Last year also saw ANZ slash its cherished dividend payments. This ASX bank ended up only paying out 60 cents per share in dividends over 2020, a massive drop from the $1.60 it shelled out in 2019.
So it's not hard to see why investors shunned ANZ shares in 2020.
ANZ share price rises after dividends restored?
This year has seen ANZ's dividend bona fides restored somewhat. In July, ANZ paid out its interim dividend for 2021, which came to 70 cents per share, fully franked. That's more than what ANZ paid out over all of the previous year. Just this week, ANZ also announced its upcoming final dividend will be worth 72 cents per share (also fully franked). That's getting pretty close to its 2019 levels.
Since ANZ underperformed the ASX 200 by such a large margin in 2020, it's perhaps not too surprising to see it bounce back stronger in 2021 so far, especially with such an enthusiastic return to paying out healthy dividends.
But one final thing to note. While ANZ's performance has smashed the market, it's actually pretty poor for an ASX bank share. In contrast to ANZ's year-to-date performance, Commonwealth Bank of Australia (ASX: CBA) has appreciated by 27.5% over the same period. National Australia Bank Ltd (ASX: NAB) shares have gained 27% gain, while Westpac Banking Corp (ASX: WBC) takes the major bank cake with gains of 32.5% in 2021 so far.
Sorry to rain on your parade with that, ANZ shareholders!
At ANZ's last share price, this ASX bank has a dividend yield of 3.73%.
