dividend requirement

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Dividend requirement

The annual earnings minimum required for payment of dividends on a preferred stock.

Dividend Requirement

The earnings of a publicly-traded company that the company has contractually obliged itself to pay out as dividends for preferred stockholders. Most of the time, when a company issues preferred stock, it guarantees buyers a certain dividend. This can be beneficial as it may attract buyers, but at the same time the dividend requirement can put a financial strain on the company. See also: Payout Rate, Plowback Rate.

dividend requirement

Total annual preferred dividends to be paid by a company.
References in periodicals archive ?
This was the result of the government's decision to adjust the required dividends from 50 percent to only 10 percent of the net earnings of government-owned and -controlled corporations (GOCCs) generating very low profits.
Freddie Mac said it would pay $7 billion in required dividends to the Treasury next month and could make a larger payment based on its own recalculation of tax writedowns.
If Fannie and Freddie continue to post profits in excess of their required dividends, they will be able to do so under the new plan.