Economics
Banks Ace Fed Stress Tests, Pave Way for Shareholder Payouts
- Results show top firms could withstand a severe recession
- Large lenders are poised to return $80 billion to investors
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Wall Street’s biggest banks are set to return tens of billions of dollars to investors after all the lenders passed the Federal Reserve’s annual test of their ability to withstand market turmoil.
The banks examined showed that they had enough capital to handle a cocktail of surging unemployment, collapsing real-estate prices and a plunge in stocks, the Fed said in a statement Thursday. Major firms including JPMorgan Chase & Co., Morgan Stanley and Goldman Sachs Group Inc. also faced a made-up market shock that tested the resiliency of their trading operations.