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Shareholders boosted by dividends

British businesses have returned £15 billion to shareholders during the first three months of the year, meaning investors are on track to receive the highest dividend income since 2008, according to research.

Capita Registrars revealed that during the first quarter dividend payouts were 10.3 per cent, or £1.4 billion, higher than during the same period last year. This is also the fastest quarterly growth since the third quarter of 2008.

After analysing data on UK dividends from Exchange Data International, Capita Registrars has predicted that shareholders will receive a total of £64.2 billion in dividend payments during 2011, which is 13.6 per cent more than the previous 12 months and the highest since 2008.

During the three-month period a total of 156 firms paid a dividend, while 126 of them either increased the amount they paid or reinstated their dividend and 10 held it level.

Only 40 firms either reduced the dividend paid or cancelled it altogether.

These figures contrast with those for 2009, when most companies reduced the amount of cash they returned to shareholders.

Charles Cryer, chief executive of Capita Registrars, said: "2011 has got off to a very strong start, and underlying dividend growth will accelerate from here.

"Income investors are set to enjoy the best year since 2008, with an extra £7.7 billion flowing from UK companies into their pockets."

Copyright © Press Association 2011