Top U.S. banks hike dividends after sailing through Fed's stress test

U.S. banking giants announced plans to raise their third-quarter dividends on Friday after proving that they have enough capital to withstand severe economic and market turmoil in the Federal Reserve's annual health check.

Bank of America's dividend will rise to 26 cents a share from 24 cents, and Citigroup's will increase to 56 cents from 53 cents, the lenders said in separate regulatory filings.

Morgan Stanley also boosted its dividend to 92.5 cents a share from the current 85 cents, according to a filing.