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The Federal Reserve Thursday released the results of the CCAR stress tests and with them, its opinion of the amount of capital the top 18 banks in the U.S. would be permitted to return to shareholders. Unlike the results released last week, the calculations of minimum Tier 1 common ratios assuming a severe stress scenario over a nine-quarter period incorporated the bank's own proposals on capital actions. The clear winners among them were American Express (NYSE:AXP), State Street (NYSE:STT), US Bancorp (NYSE:USB) and, to a somewhat lesser extent, Bank of New York (NYSE:BK), in terms of the proportion of tangible equity they would be permitted to repurchase. AXP was permitted to repurchase 33% in 2013, while SST and USB could repurchase 18%, and BK 11%. Others were restricted to more modest 4-6% repurchases. Dividend increases were also permitted for raising the payout ratios on trailing earnings to up to 35% for these banks in most cases. The surprising decision was for Keycorp to raise its dividend up to 10-fold to what amounts to a 250% payout, even though share buybacks would be modest. Perhaps this portends a special dividend. Keycorp has a particularly high Basel III ratio estimate of 10.4%, which is not reflected in the Basel I ratio strength, so has the leeway to reduce capital.

Clear losers were Ally Financial and BB&T. The Fed denied Ally any capital actions, not surprisingly given that its Tier 1 common ratio falls below the 5% minimum. BB&T was also denied because it indicated it was in process of recalibrating the risk-weighted assets upon which the capital ratio is calculated.

Other results were less definitive. Morgan Stanley (NYSE:MS) did not ask for share repurchases but was granted permission to purchase the remainder of Smith Barney from Citigroup. PNC was granted permission to raise dividends by an unspecified amount. Goldman Sachs was not specific about what capital actions were approved, although given the difference between last week's Dodd-Frank stress test results and the CCAR, it has permission to reduce capital by about half of a percentage point. Clearly, the stress tests were designed to hit the investment banks hard for their trading operations, limiting what they could demand. JPMorgan's (NYSE:JPM) requests were constrained by the same considerations.

The intriguing question in the results released was why some of those that came through with the highest ratios declined to ask for higher returns to shareholders. Bank of New York would remain with Tier 1 common equity of 13%, and State Street with 9.7%. Perhaps they were just testing the waters and will ask for more next year.

CCAR Min. Tier 1 Common

Share buybacks

Dividend payout ratio adj. for increases

Ally Financial Inc.

1.52

-

American Express Co

6.42

33.3%

23.7%

Bank of America Corp

6.04

3.5%

The Bank of New York Mellon

13.21

10.8%

29.9%

BB&T Corporation

7.76

-

Capital One Financial Corp

6.69

-

17.9%

Citigroup Inc.

8.22

0.8%

Fifth Third Bancorp

7.5

5.8%

The Goldman Sachs Group

5.26

-

JPMorgan Chase & Co.

5.56

4.1%

29.2%

KeyCorp

6.75

4.8%

250.0%

Morgan Stanley

5.62

-

The PNC Financial

8.55

-

Regions Financial

7

3.6%

15.0%

State Street Corporation

9.65

17.7%

21.7%

SunTrust Banks, Inc.

6.91

1.5%

11.1%

U.S. Bancorp

6.61

17.6%

32.4%

Wells Fargo & Company

5.94

3.4%

35.3%

Source: CCAR Winners And Losers