BP establishes a $20 billion fund for the Deepwater Horizon Rig spill and suspends dividends for at least 3 quarters this year. The stock has taken a large drop from it’s pre-spill days, losing nearly half it’s value from $60 a share.
There will be big impact for the shareholders who rely on the dividends for retirement or income. The dividends was previously paid at $3.36 per share every year. Today’s the dividends will be paid at $0 per share, until the suspension is lift.
I have bought BP shares recently in hopes of collecting dividends, which yielded around 6% for me, but now, I would have to rethink whether or not it is worth holding on to BP shares any more. The stock tanked, the dividends suspended, and their reputation heavily damaged. It would take a long time for BP to recover.