Passive income investors who took the plunge and bought Westpac Banking Corp (ASX: WBC) shares in early 2021 were taking a bit of a risk.
That's because Australia's financial markets were only just beginning to recover from the COVID-19 wallop of 2020.
Indeed, 2020 marked the only year in over a decade that the S&P/ASX 200 Index (ASX: XJO) bank stock suspended its interim dividend payout. As for the single dividend it did pay, the final Westpac dividend in 2020 was down 61% from 2019.
So, while the Westpac share price had recovered much of its pandemic losses by January 2021, passive income investors couldn't be sure what they might receive moving forward.
As we'll look at below, they won't have been disappointed.
How much passive income have Westpac shares delivered?
On 8 January 2021, you could have snapped up Westpac shares for $20.28 apiece.
That means your 300 shares will have set you back $6,084.00.
Now, before we look at the passive income those shares will have returned, you'll also have enjoyed some sizeable capital gains.
The ASX 200 bank stock has enjoyed a particularly strong run over the past year, with shares currently changing hands for $31.85 apiece. While that's down 1.4% in intraday trade today, it's up 57% from early January 2021.
It also means that the 300 shares you bought for $6,084.00 back then are currently worth $9,555.00. Or a tidy gain of $3,471.00.
Now, let's add that passive income back into the picture.
If you bought Westpac shares in January 2021, you'd have received the past seven fully franked dividend payouts. You'd have to wait until December to bank that eighth one.
As for the past seven dividends, they add up to a total of $4.75 a share, fully franked. Or $1,425 of passive income from those 300 shares.
Adding that to today's share price of $31.85 and the accumulated value of the Westpac shares you bought in January 2021 for $20.28 comes to $36.60. Or a gain of 81%.
What about the latest dividend?
In a promising trend, Westpac's dividends have been growing every year since 2020.
On 6 May this year, the bank declared an interim dividend of 75 cents per share and a special dividend of 15 cents per share, both fully franked. This brought the latest Westpac dividend to 90 cents per share, up 29% from the FY 2023 interim dividend.
Commenting on that boosted passive income at the time, Westpac CEO Peter King said, "Westpac's balance sheet is in good shape and with the momentum in our business, supports a special dividend of 15 cents per share fully franked."
