"These banks are strong and have too much capital now," The Wall Street Journal quoted RBC Capital Markets analyst Gerard Cassidy as saying.
The 19 largest banks are required to submit payback plans to the Fed on Monday. A year ago, the Fed rejected Citibank Group's plan saying the bank was not strong enough to deplete its reserves with a payback plan.
The Journal reported that JPMorgan Chase is expected to submit a $6 billion plan that includes dividend disbursement and share repurchases.
Fifth Third Bancorp, which also had a plan rejected in 2012, is expected to submit a new plan for payouts this year. Morgan Stanley, however, is expected to sit tight, electing to hold onto capital to convince the Fed that it is strong enough to take full control of a wealth management unit this year.
Bank shares have recently risen as investors have flocked to financial firms in the expectation that an era of paybacks are around the corner.
A key indicator shows dividend payments among the 19 largest banks is low compare to just before the financial crisis.
The annual payout as a percentage of bank share prices averaged 1.71 percent January through September 2012, SNL Financial said.
In 2007 and 2008, that measure stood at 3.86 percent and 4.88 percent, respectively, the Journal said.