It’s the 30th of December 2021. We are almost done. Only one day left and then… nothing will change. The renewed spread of COVID just before the New Year’s Eve gives us the feel of being in the exactly same situation as we were in back at the end of 2020. There seems to be just no relief, no end to it.

But, when we look a little closer, there is actually a ray of sunlight coming through the clouds. The virus has spread significantly more across the globe by now than it did a year back, and yet we don’t see the same overwhelmed hospitals and clinics. Medical institutions are now getting in trouble not because of too many patients, but more so because of too many resignations among healthcare professionals.

I don’t want to get too much into the vaccine debate, but anyone who can’t see that the mass-distribution of vaccines has helped to ease the situation is just being ignorant at this point.

Rising dividends are coming up

But let’s talk about the main theme of this blog. Investments, and today in particular, dividends. 2020 and 2021 were 2 years marked by stagnant and falling dividends. Some companies had to scrap them altogether, some had to reduce them. Banks in Europe were even forced not to pay out dividends for almost a whole year. But this has started to shift in 2021, and it will continue to change in 2022.

While the pandemic keeps raging, businesses adapted to the challenges at hand. They found new markets, adapted their products and services, changed distribution channels, reduced costs, and now they start seeing profits again. I know that many non-investors consider this an affront against society as a whole for a business to make a profit and to share it with its shareholders. Even more so during bad times. But that’s how every business works.

So when a business is making profits then it needs to reward its investors. And dividends (which are also being taxed by the way) are a good way to do just that. We can therefore rightfully expect in 2022 a return of dividend payments.

Whether it will be a full re-instatement, or slight increases after previous cuts. I don’t know yet. But I know that after a dividend payout reduction of 11.58% in 2020 and only a very small increase of 17.10% in 2021, I expect now a continuous growth to be back on track in 2022. My current estimates are somewhere between 15-20% for the western world.

Dividends in Thailand

Thailand also saw its fair share of dividend cuts and postponements. And indeed here, I expect a significantly higher dividend growth. For the portfolio that I am managing for my family here, I actually expect a dividend growth of at least 50%.

A large push should come from the finance industry, especially from banks and insurance companies. Many of them have either cut or cancelled dividends here in 2021, and being now back on the path of growth they should fully re-instate or even grow them beyond pre-covid levels. I have shares of Bangkokbank (BBL), Kasikornbank (KBANK), Krung Thai Bank (KTB), MFC Asset Management (MFC), Tisco (TISCO), and Bangkok Insurance (BKI). I expect rising profits for all of them, and thus also rising dividends.

Another sector which should see growth is the one that deals with sustainability. Here are some great companies with excellent dividends, which I also purchased throughout the year: BG Container Glass (BGC), Global Green Chemicals (GGC), Stri Trang Agro Industry (STA), and Thai Tap Water (TTW) are all in the portfolio which I continue to manage.

Happy New Year

To sum it up, I like to wish all my readers a happy, healthy, and financially rewarding new year. 2022 won’t be easy, but as we are all adapting to the situation, investors can expect to see returns coming in for their perseverance and patience in the coming year and beyond.