The ANZ Group Holdings Ltd (ASX: ANZ) share price is starting the week in the red.
In morning trade, the banking giant's shares are down by 4% to $27.89.
As a comparison, the benchmark ASX 200 index is currently 0.1% lower in early trade.
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Why is the ANZ share price tumbling?
The big four bank's shares are falling today after trading ex-dividend for its upcoming interim dividend.
When a share trades ex-dividend, it means that the rights to an impending dividend payment are now settled.
As a result, if you were to buy its shares today, the rights to that dividend would stay with the seller and not transfer to the buyer.
Given that a dividend forms part of a company's valuation, a share price will tend to drop in line with the value of the dividend on the ex-dividend date. After all, it new buyers don't want to pay for something that they won't receive.
What is the ANZ dividend?
Last week, ANZ released its first-half results and reported a cash profit of $3,552 million for the six months ended 31 March. This represents a 1% decline compared to the second half of FY 2023.
This reflects a strong performance from the Institutional business, which reported a 12% lift in cash profit to $1,522 million, which was offset by a poor half for the Australia Retail business. It posted a 9% decline in cash profit to $794 million despite delivering above-system home loan growth with pricing above cost of capital.
However, much to the delight of shareholders, that profit decline didn't stop the bank from increasing its dividend by 2 cents year on year to 83 cents per share. This dividend is partially franked at 65%.
Based on Friday's closing ANZ share price of $29.09, this dividend equates to an attractive 2.9% dividend yield. And there's still a final dividend coming in six months.
But what will that dividend be? Analysts at Goldman Sachs believe that a final dividend of 81 cents per share will be declared with the bank's full year results. This will bring its total dividends for the year to $1.66 per share. This equates to a dividend yield of 5.7% based on last week's closing price.
When is pay day?
Eligible shareholders won't have to wait too long until they are paid out the bank's interim dividend.
ANZ is currently scheduled to make this dividend payment in 7 weeks on 1 July.
ASIC investigation
In other news, also potentially weighing on the ANZ share price is reports that ASIC is investigating the company for suspected contraventions of a number of provisions of the ASIC Act and the Corporations Act.
According to The Australian, the investigation relates to ANZ's execution of a 2023 issuance of 10-year Treasury Bonds by the Australian Office of Financial Management.
