Fed gives big US banks green light for buyback, dividend

WASHINGTON: The Federal Reserve has approved plans from the 34 largest US banks to use extra capital for stock buybacks, dividends and other purposes beyond a cushion against possible catastrophe.

On Wednesday, the Fed said all of the 34 banks had passed the second, tougher part of its annual stress test, showing that many of the biggest lenders have not only built up adequate capital levels but also improved their risk management procedures.