Big Banks Sail Through Stress Test in Harbinger for More Payouts.

The biggest US banks have passed the Federal Reserve's annual stress test, indicating that they have enough capital to withstand a hypothetical recession. The stress test included 31 banks with at least $100 billion in assets, and all of them stayed above their minimum capital requirements. The test showed that the banks would experience nearly $685 billion in losses, but this is within the range of previous stress tests. The results highlight the importance of the extra capital that banks have built up in recent years. Capital requirements have been a topic of debate, with banks arguing that they already have enough capital and that stricter rules would harm consumers and businesses. While every bank passed the test, there were variations in the results, with JPMorgan Chase & Co. and Wells Fargo & Co. experiencing declines in their capital ratios. The Federal Reserve expects banks to wait until after Friday to announce any plans for dividends and buybacks. [Extracted from the article]

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