All big US banks pass Fed’s annual ‘stress tests’
NEW YORK (AP) — The nation’s 3 biggest banks have enough capital to withstand a severe economic contraction.
That’s according the Federal Reserve’s latest annual “stress tests” of the U.S. financial system.
The Fed built a scenario under which the nation’s unemployment rate would more than double to 10 percent, and a severe contraction in commercial real estate and stock market values would cause losses of more than $600 billion.
The Fed said that even in with those variables, the 33 largest banks would still on average have a capital ratio 9.7 percent, well above the 4.5 percent
required by law.