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Goldman passes self-administered stress test

  • Goldman Sachs' (GS +2.2%) Tier 1 common capital ratio would fall to 8.9% in the nine quarters up to mid-2015 under the "severely adverse scenario" in its self-administered stress test, up from this spring's prediction of 8.6%. Losses would foot to $6.2B on revenue of $15.5B, down from a $6.6B loss on $20.4B in revenue at the spring estimate.
  • Like with Ciitgroup (previous), the severe scenario assumes a large decline in GDP, a sustained rise in unemployment, and falling interest rates (like for Citi, why not test sharply higher rates?).
  • The Fed's stress test - the CCAR - at which banks' capital return plans will be accepted or not - takes place next year, with results due in March.
  • Goldman's Mid-Cycle Stress Test Results.
Comments (1)
  • GS.smartest people in the room.
    16 Sep 2013, 05:47 PM Reply Like
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