WASHINGTON -- The Federal Reserve says all of the 34 largest U.S. banks are fortified enough to withstand a severe U.S. and global recession and continue lending.
The first round of the central bank's annual "stress tests" shows that as a group, the 34 big banks have gained strength thanks to a steadily recovering economy.
The banks were tested to determine if they have large enough capital buffers to keep lending, even if hit with billions of dollars in losses brought on by a financial crisis and severe economic downturn.
The tests' hypothetical "severely adverse" scenario showed $100 billion in projected losses from credit card loans for the banks. The Fed says it was the first time that the tests showed credit card lending as the biggest loss category.
