BAC vs C: Dividend Comparison
Dividend data as of
Bank Of America Corp /De/ (BAC) and Citigroup Inc (C) are both in the Financials sector, making them natural rivals for dividend investors. Both stocks offer similar yields — BAC at 1.95% and C at 1.90%. For dividend growth, C leads with a 5-year CAGR of 11.0% versus BAC's 8.5%. Both stocks carry a "Safe" dividend safety rating. BAC is a Dividend Contender with 12 years of consecutive increases.
Verdict
Yield Analysis
BAC yields 0.05% more than C. In dollar terms, BAC pays $1.08/share vs C's $2.32/share annually.
Dividend Growth
BAC: Dividend growth has been steady, with a 3-year CAGR of 8.3% and a 5-year CAGR of 8.5% (10-year: 17.6%).
C: Dividend growth is accelerating — the 3-year CAGR of 21.6% exceeds the 5-year rate of 11.0% and the 10-year rate of 22.6%.
Dividend Safety
BAC: The payout ratio of 28% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.5x.
C: The payout ratio of 33% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.0x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in BAC vs C today?
At $52.38 per share, $10,000 buys about 190.9 shares of Bank Of America Corp /De/ (BAC). Each share pays $1.08 per year in dividends, so the position starts out generating roughly $206 per year — about $17 a month.
At $110.67 per share, $10,000 buys about 90.4 shares of Citigroup Inc (C). Each share pays $2.32 per year in dividends, so the position starts out generating roughly $210 per year — about $17 a month.
On day one the two positions generate nearly identical income; the difference comes from what happens to each dividend afterward.
What could $10,000 of BAC or C income look like in 10 years?
Bank Of America Corp /De/ (BAC) has raised its dividend about 8.5% a year over the past five years. If that pace held, the $195 per year that $10,000 generates today at the current 1.95% yield would reach $440 per year by 2036 — a 4.4% yield on the original cost.
Citigroup Inc (C) has raised its dividend about 11.0% a year over the past five years. If that pace held, the $190 per year that $10,000 generates today at the current 1.90% yield would reach $538 per year by 2036 — a 5.4% yield on the original cost.
On those trailing rates, C pays more in 2036: $538 versus $440 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would C's dividend growth overtake BAC's higher yield?
Citigroup Inc (C) yields less today (1.90% vs 1.95%) but has grown its dividend faster — 11.0% vs 8.5% a year over the past five years. If both trends continued, a $10,000 position in C would start out-earning the same position in BAC around 2028 (roughly 2 years from now), paying about $234 per year at the crossover. Before that point, BAC pays more each year; after it, the gap compounds in C's favor.
Can BAC and C afford their dividends?
Bank Of America Corp /De/ (BAC) earns $3.81 per share against $1.08 paid out in dividends — 3.5x coverage (a 28% payout ratio).
Citigroup Inc (C) earns $6.99 per share against $2.32 paid out in dividends — 3.0x coverage (a 33% payout ratio).
BAC's wider coverage leaves more cushion if earnings dip. As a rule of thumb, coverage below about 1.5x (a payout ratio above ~65%) is where a dividend starts to look stretched — worth watching for C if earnings weaken.
Which fits an early-retirement income portfolio better, BAC or C?
For income you need right now, Bank Of America Corp /De/ (BAC) leads: $100,000 invested today pays about $162 a month at the current 1.95% yield, versus $158 a month from Citigroup Inc (C) at 1.90%.
With a decade or more before the income is needed, C's faster dividend growth (11.0% vs 8.5% a year) matters more than the starting yield — raises compound into the larger paycheck over time.
On consistency: BAC has raised its dividend 12 consecutive years.
Many income investors simply hold both — the mix pairs current yield with growth and spreads single-name risk. Whichever way you lean, dividends are never guaranteed; recheck the payout each quarter rather than setting and forgetting.
$10,000 with DRIP: projected annual income
If each holding keeps raising its dividend at its real 5-year rate and every payment is reinvested, a $10,000 position pays $534/yr in BAC vs $649/yr in C by year 10.
Assumes dividends are reinvested at the current yield and grow at each holding's trailing 5-year dividend CAGR. A projection, not a prediction — no price appreciation modeled.
Track BAC and C in your portfolio
See your real income from both — forward projections, yield on cost, and dividend safety signals. Sync your brokerage free for 30 days, or track holdings manually on the free plan.
Choosing a tracker? See the best dividend trackers compared.
Frequently Asked Questions
Related Resources
Individual Stock Analysis
Dividend Tools
Track Your Dividends
More Comparisons
This tool is for educational and informational purposes only and does not constitute investment, financial, tax, or legal advice. Consult a licensed professional before making investment decisions.
Past performance does not guarantee future results. All projections are hypothetical estimates based on user-provided inputs and may differ materially from actual outcomes.
By using this tool you agree to our Terms of Service and Privacy Policy.