This year’s Fed stress test for banks offered one fairly simple takeaway – it’s not the best time to be a money center bank. While super-regionals like Fifth-Third (FITB), PNC (PNC), Truist (TFC), and U.S. Bancorp (USB) had pretty undramatic results and capital market specialists like Goldman Sachs (GS) and Morgan Stanley (MS) came out well, it wasn’t such a smooth process for the largest money center banks like Bank of America (NYSE:BAC), Citigroup (NYSE:C), and JPMorgan (JPM).
The net result of new stress capital buffer requirements is that the largest banks in the country are largely going to be on the sidelines when it comes to significant capital returns to shareholders for the next six to 12 months. While the underlying operating environment is still a good one for banks (loan growth, higher rates, et al) provided that the economy can thread the needle and avoid recession, the lower near-term capital return prospects are going to be another hurdle for these already-pressured shares to surmount.
Read more here:
No comments:
Post a Comment