Obama administration on Thursday concluded the results of Stress Tests and found that 10 of the largest U.S. banks will have to raise a total of $75 billion to prepare for losses that could come from recession.
Following are the banks which needs to raise capital found as a result of Stress Tests
This capital needs to be raised in the next 3 months.
Following are the banks that have not been asked to raise more capital and found in good financial health. They are:
What’s the use of the stress tests?
The stress tests evaluate banks and the industry’s financial health if the economies badly go downhill or the economy is getting stronger. The results — showing that 10 of the US’s largest banks will need to raise capital, while nine will not.
Its believed that this information is useful for the investors. Using the results of stress test investors get to know about banks’ financial conditions which in turn makes it easier for the industry to raise private capital. This will allow banks to start again lending to consumers and small businesses, reducing the credit crunch.
So overall though things looks positive, coming out of recession is still far away. Despite these Stress test question remains Is recession over?
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[...] sagarkasar Is slowdown over? well there is no exact unit or equation to measure. There are various Stress tests based on which at least slow down can be measure [...]