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First Financial (FFBC) Rewards Investors With New Buyback Plan

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First Financial Bancorp (FFBC - Free Report) recently announced a share-repurchase plan, under which the board of directors has approved up to five million shares. This represents 5% of the company’s outstanding common stock as of Sep 30, 2020.

The new program will commence once First Financial’s current buyback plan expires on Dec 31, 2020. The new plan will continue for the next two years.

First Financial’s present share-repurchase program was announced in January 2019, authorizing the repurchase of five million shares. Nonetheless, it was suspended in first-quarter 2020 in order to preserve liquidity amid the business disruptions due to the coronavirus pandemic.

Archie Brown, First Financial's chief executive officer, said, "While we currently have no specific timeline for resuming share repurchases, the reauthorization of this plan is a part of our normal capital planning process and provides us with the option to be opportunistic as we gain more clarity around the current economic environment."

First Financial has also been paying out regular quarterly dividends. In October, the company announced a quarterly cash dividend of 23 cents per share. The dividend was paid out on Dec 15 to shareholders of record as of Dec 1. Considering last day’s closing price of $16.75 per share, the dividend yield currently stands at 5.5%.

Though the actual repurchasing of shares will depend on the prevailing economic situation, the company's share-buyback plan, along with payment of regular quarterly dividends, makes it an attractive choice for investors.

In the past year, shares of First Financial have depreciated 34.6% compared with the 15.9% decline of the industry it belongs to.

Currently, First Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Other Banks Taking Similar Actions

In the past few months, several banks like BancorpSouth Bank , Home Bancorp, Inc. (HBCP - Free Report) and HarborOne Bancorp, Inc. (HONE - Free Report) have announced new share-repurchase authorizations. BancorpSouth's board of directors has approved the repurchase of about six million shares of the company’s common stock, while Home Bancorp’s board approved the repurchase of up to 444,000 shares.

Further, HarborOne Bancorp’s board has adopted a share-repurchase program, under which it has authorized buyback of up to 2.92 million shares.

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