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Sun Life Financial Inc. is the second Canadian financial institution to raise its dividend after Canada’s banking regulator lifted pandemic-related restrictions.

The insurer announced on Monday that its board has approved an increase of 20 per cent, or 11 cents per share, bringing its total quarterly dividend to 66 cents a share.

Sun Life’s rate hike follows Manulife’s announcement last Friday that it had approved an increase of 18 per cent, or five cents per share, bringing its total quarterly dividend to 33 cents a share.

The two rate hikes come hot on the heels of an announcement last Thursday by the Office of the Superintendent of Financial Institutions (OSFI) that temporary measures that had prohibited dividend hikes and share buybacks by financial institutions since March, 2020, were no longer in place, effective immediately.

The temporary measures were put in place so financial institutions would preserve capital and be able to continue to make loans in the early stages of the COVID-19 crisis.

Canada’s six largest banks aren’t expected to announce their plans for dividend increases and share buybacks until they report quarterly earnings in late November and early December. The banks are in a quiet period leading up to the release of those financial results.

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