Fed finds major banks able to withstand ‘severe recession’

US Federal Reserve
US Federal Reserve

Major US banks all passed this year’s round of stress-testing by the Federal Reserve, offering some reassurance to policy-makers as the US faces a possible economic slowdown.

The stress test found the banking system could suffer aggregate losses of over $600 billion in a “severe recession”. But all of the 34 banks that took part in the test passed.

The system as a whole would see capital ratios drop by 2.7 percentage points, the Fed found, the biggest drop since 2018. This partly reflected the

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