Fed approves buyback, dividend plans for all largest banks
NEW YORK (AP) — The Federal Reserve has approved all the capital plans that the nation’s 18 largest banks submitted as part of this year’s stress tests.
That means that the Fed determined banks like JPMorgan Chase, Citigroup and Bank of America can raise their dividends and buy back more shares this year and still have enough capital to survive a hypothetical deep recession in the next year.
The Fed did ask one European bank, Credit Suisse, to fix a few issues in its capital plan and will revisit the bank’s plan in four months.
The stress tests were mandated after the Great Recession under the Dodd Frank Act. They are designed to test whether a large bank could survive a sudden economic downturn without imploding, as was the case a decade ago.