Owners of Westpac Banking Corp (ASX: WBC) shares might be in for a good run, with one top broker predicting the bank will pay out 10% more in dividends in financial year 2023 than it did in financial year 2021.
It's also tipping the bank will up its full-year payouts by 5.9% in financial year 2022.
Right now, Westpac shares are swapping hands for $21.93, 0.16% lower than they were at Friday's close.
For context, the S&P/ASX 200 Index (ASX: XJO) is also down 0.06% today while the S&P/ASX 200 Financials Index (ASX: XFJ) has slumped 0.22%.
So, what could the future hold for the big four banking giant's dividends? Let's take a look at what Morgan Stanley thinks.
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Westpac dividends and share price to lift: broker
As one of the ASX 200's biggest bank shares, Westpac is known to be a relatively strong dividend payer. Indeed, it's been paying investors a portion of its profits since the early 1980s.
And its full-year payouts could be gearing up to leap over the coming two financial years.
While most ASX companies wrap up their financial years at the end of June, Westpac's doesn't end until 30 September.
That means the last full-year payout we have to reference is that of financial year 2021, which saw the bank offering $1.18 of dividends per share.
With that in mind, Morgan Stanley thinks the market could be in for a surprise when Westpac releases its full-year earnings in November.
The broker expects Westpac to offer $1.25 per share in dividends this financial year, as my Fool colleague James reports.
Its full-year dividends are tipped to rise once more in financial year 2023 to reach $1.30. That's a whopping 10.1% higher than that of financial year 2021.
Though, that's still less than the $1.74 offered to shareholders in financial year 2019.
Morgan Stanley has also slapped Westpac's shares with a $22.30 price target and an outperform rating.
