Real stress hurts bank buybacks


The just-published results of the Fed’s theoretical crisis exams showed big banks have plenty of capital to survive a severe shock. At the same time, the Fed has already told JPMorgan Chase & Co, Citigroup Inc and Goldman Sachs Group Inc to build in bigger cushions next year to guard against the systemic risks they present.

JEROME Powell is putting big United States banks through two stress tests.

The Federal Reserve (Fed) chair’s merciless interest-rate increases are hitting asset values hard, and that’s likely to prove painful in second-quarter earnings and beyond.

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