5 Fall Foul of Fed Stress Tests

The FT is reporting that 5 of the 30 banks which were subject to the Federal Reserve’s annual stress tests have failed to have their capital plans approved, restricting dividend payouts to investors.  The five due for resits are Citigroup, Zions Bancorp, and the US units of HSBC, RBS and Santander.

Despite meeting the 5% minimum tier one capital ratio, four of the five had their capital plans rejected on “qualitative” measures.  A further two banks, Goldman Sachs and Bank of America, were required to resubmit plans based on reduced payouts in order to conserve capital levels.