Shareholders in the big banks can expect to continue receiving the same share of profits they get today if Australia is hit by a recession as severe as the slump of the early 1990s.
With banks generating millions in excess capital, Commonwealth Bank, ANZ and NAB have all increased their dividend payout ratios in recent months, while Westpac paid a special dividend.
In a report published on Wednesday, credit rating agency Moody's found the higher payout ratios of about 75 per cent were sustainable, even during an economic downturn.
While households carry much more debt today than they did two decades ago, in recent years banks have been working hard to build up capital as a buffer against losses.
"Our scenario analysis suggests that, in a cyclical economic downturn akin to that experienced during the 1991 recession, the banks would be able to sustain the modestly increased dividend payouts, and maintain capital ratios at strong levels," Moody's says.
If Australia suffered a more severe collapse such as the housing meltdown in the United States during the global financial crisis, big four shareholders would see dividends cut.
Under these circumstances, they say banks would suffer "material" declines in their capital levels and would have to cut dividends and raise extra capital.
The report comes as some market analysts predict banks may seek to further increase their dividends later this year because weak demand for new loans leaves lenders with excess capital.