Out of 18 large banks, the ""Federal Reserve"":http://www.federalreserve.gov announced 14 banks received approval for their capital plans, while the plans of two banks, Ally Financial and BB&T Corp., were rejected.[IMAGE]
According to the results, Goldman Sachs and JP Morgan Chase were not rejected but are required to submit new capital plans. According to the Fed, each bank ""exhibited weaknesses in its capital plan or capital planning process that were significant enough to require immediate attention.""[COLUMN_BREAK]
The 18 banks were examined as part of the ""Comprehensive Capital Analysis and Review"":http://www.federalreserve.gov/newsevents/press/bcreg/ccar-2013-results-20130314.pdf (CCAR), which includes assessments of the banks' capital ratios under severe economic and financial market stress and the banks' proposed dividend and buyback plans.
""Strong capital levels help ensure that banking organizations have the ability to lend to households and businesses and to continue to meet their financial obligations, even in times of economic difficulty,"" the Fed stated in a release.
The banks that did receive approval were American Express; Bank of America; The Bank of New York Mellon; Capital One; Citigroup; Fifth Third Bancorp; KeyCorp; Morgan Stanley; PNC Financial Services; Regions Financial; State Street; SunTrust; U.S. Bancorp; and Wells Fargo.
According to the results, American Express had at least one minimum post-stress capital ratio fall below regulatory minimum levels in its original plan but submitted a readjustment.
""The financial crisis showed not only that regulators needed to increase capital requirements and conduct regular stress tests, but also that firms need strong internal processes to evaluate their own capital needs based on their individual risks and circumstances,"" said Fed Reserve Governor Daniel Tarullo.
The 18 banks hold more than 70 percent of total assets.