Banks could face tougher stress tests next year


The Fed intends to use its own estimates about the effect of a recession on bank balance sheets in its stress tests. Previously, the Fed has relied on data from the firms themselves.

The central bank could project that bank assets would grow during a slump, as has happened in the past three recessions, rather than fall, as the banks have predicted.

With such a finding, the Fed could require banks to hold more loss-absorbing capital or limit shareholder payouts. (Fed letter)

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Comments (3)
  • JamesChessing21
    , contributor
    Comments (133) | Send Message
     
    All we want for Christmas from BAC in a miniscule 10 cent per quarter,,,or 40 cents PA aq yield of 2.6 %....
    17 Dec 2013, 08:58 AM Reply Like
  • Hello Again 83
    , contributor
    Comments (682) | Send Message
     
    Banks are way way over capitalized to begin with. They will pole vault over any hurdle put in front of them.
    17 Dec 2013, 09:39 AM Reply Like
  • DoowopDave
    , contributor
    Comments (253) | Send Message
     
    All the money center banks know what's coming. BAC is ready. There is nothing new here. However, need approval of the $8.5 bn settlement before there will be a dividend change. I don't know what is taking the judge so long.
    17 Dec 2013, 07:06 PM Reply Like
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