Many investors who scour the ASX for the best sources of dividend income will opt to add Westpac Banking Corp (ASX: WBC) shares to their portfolios. As an ASX bank stock, and one of the big four no less, Westpac has a strong and deserved reputation as one of the ASX's most reliable providers of fat, fully franked dividends.
It has also built a reputation as a strong ASX performer in recent years. As recently as late 2023, Westpac shares were going for just over $20 each. Today, those same shares will set an investor back $38.87 (as of yesterday's close). The bank has traded as high as $41 late last year. That means Westpac shares have almost doubled between late 2023 and late 2025.
While this rise has been wonderful for existing investors, it has also had the less-than-desirable effect of reducing the bank's dividend yield. Remember, a stock's dividend yield is a function of two underlying metrics. The first is the raw dividends per share that the stock pays each year. The second is the share price. So even though Westpac raised its raw dividends over 2025, the dividend yield on its shares dropped dramatically thanks to its enthusiastic share price performance.
But let's talk about those raw dividends. Last year, Westpac forked out two dividend payments, as is its habit. The first was the June interim dividend worth 76 cents per share. The second, the December final dividend which came in at 77 cents per share. Both payments came fully franked, and both represented increases of 1 cent per share over the previous year's corresponding dividend.
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How much income will Westpac's dividend provide in 2026 and beyond?
This annual total of $1.53 in dividends per share gives Westpac a trailing dividend yield of 3.94% today. That's based on yesterday's closing share price of $38.87.
However, trailing dividend yields reflect the past, and are not a guide to future income.
Of course, we won't know exactly how much Westpac will dole out in dividends in 2026 until the bank reveals its two dividends later in the year.
However, we can look at what some analysts are predicting.
Earlier this week, my Fool colleague Tristan looked at what kind of dividends analysts are pencilling in from Westpac over the next few years.
In some good news for income investors, these analysts are predicting that Westpac will be able to raise its dividend to $1.575 over FY2026, rising to $1.60 per share by FY2027 and then to $1.65 by FY2028. If these numbers do turn out to be accurate, they would give Westpac shares forward dividend yields of 4.05%, 4.12% and 4.24% respectively. Let's see what this ASX 200 banks tock reveals later this year.
