Investment trust dividend heroes

Eight investment trusts have raised their dividends each year for 40 years or more, with another two approaching their 40th anniversary of annual dividend increases. Seven investment trusts are well into their third decade of raising dividends (see table below).

Over the last month alone, several investment trusts in the closed-ended sector have announced continued annual dividend increases, with Foreign & Colonial Investment Trust announcing yesterday that it has raised its dividend for 41 years in a row, Alliance Trust announcing today that it has raised its dividend for the 45th year in a row, Brunner recently racked up 40 years of annual dividend increases and Temple Bar an impressive 28 years of annual dividend increases.

Research from the Association of Investment Companies (AIC) among its member companies found that 46 per cent of the UK Growth & Income sector raised dividends each year for 20 years or more, while 45 per cent of the Global Growth sector has raised dividends each year for 20 years or more.

Charles Luke, manager of Murray Income Trust, commented: "We expect many companies to continue to deliver solid dividend growth in 2012. However, for some companies the realities of the global macroeconomic environment will put pressure on earnings and consequently the dividends they pay. But, in aggregate, payout ratios remain low historically, so many companies are not over-distributing and strong balance sheets suggest that financial distress is unlikely - both of these factors provide reassurance for the outlook for dividends."