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After dropping notably in 2020, global dividends are seen rebounding this year as the economy rebounds, according to a new report from IHS Markit.

Global dividend payouts dropped by US$113 billion last year, amid the economic disruption caused by the Covid-19 outbreak, the firm said.

However, it sees a bounce back for dividends in the year ahead. IHS said global dividends are forecast to rise by 6.5% this year to US$1.78 trillion.

“With the uncertainties of the Brexit deal and U.S. elections behind us, and the availability of the vaccine expected to reduce uncertainty, we expect more companies to resume payments or grow dividends in 2021,” said Amira Abdulkadir, head of U.S. dividend forecasting at IHS Markit, in a release.

While overall dividends are expected to rebound, the firm said that the recovery will vary by region.

For the U.S., it said that dividends are seen declining by another 0.7% this year, due to weakness in the banking and energy sectors.

Conversely, dividends in Europe are expected to rise by 22% and by 30% in the UK specifically.

In the Asia Pacific region, dividends are expected to grow by 6.7% this year.

IHS also said that it expects the banking sector to lead the global rankings, with the sector’s dividends expected to grow by 10.9% this year to US$214.2 billion.

It also said that the insurance sector will record the fastest growth, with payouts rising by an estimated 20%.