Straight from FedRes - summary results of the latest round of bank stress tests

MsMorrisine

summary results of the latest round of bank stress tests


Overall, 4 of the 19 BHCs have one or more projected
regulatory capital ratios (including capital distributions) that fall below regulatory minimum levels at
some point over the stress scenario horizon, including 3 BHCs with a stressed ratio of tier 1 common
ratio below the 5 percent benchmark established in the capital plans rule. In interpreting these results,
it is important to recall that the Federal Reserve’s stress scenario projections are deliberately stringent
and conservative assessments under hypothetical, adverse economic conditions and the results are not
forecasts or the most likely outcomes for these BHCs.

MsMorrisine

USA Today identifies Ally, Citi, and SunTrust for falling under 5%

I am assuming MetLife fails for not maintaing a Total Capital Ratio of 8%

Spooly

How did BOA pass? Sounds like BS to me.

MsMorrisine

<< <i>How did BOA pass? Sounds like BS to me. >>



I was looking for BoA too.

and was surprised to see SunTrust on the list.


Reuters is confirming MetLife as the 4th.

They commented there was surprise Citi was on the list.

I don't understand that. You can be top of the bailout list but still continue to mismanage. Seems easy to me.

RGJohn

<< <i>How did BOA pass? Sounds like BS to me. >>



I bet it didn't sound like BS to Warren Buffet.
Bank of America (BAC.N) has pruned staff, sold off many of the previous CEO's mistakes, settled the dollar amount of liability for the Countrywide mortgages, and has stockpiled cash. No surprise they 'passed', they determined to pass, did what they had to do to pass (including selling WB stock options which already exceed their strike price in value), and happily did pass. Expect more of the same. Without a banking system, we don't have an economy.
BS is what the advertising media sells us as information. A group of over-dressed performers masquerading as knowledgeable people while reading scripted lines do not create reality. They create theater. They twist the little they do understand for the sake of their wallets.

derryb

Let us not forget that if FASB had not changed accounting rules to protect the banks, most of the large ones would technically be bankrupt. Also, economies have been known to work for centuries without a banking system. Our banking system has made the economy dependent upon it - something that can just as easily be undone.

jmski52

I thought that something was afoot for FASB to revert back to honest accounting, maybe it was just a head fake?