Is Your Bank Solvent?
Think the financial crisis is over?
Maybe you should think again.
Money and Markets, Washington, DC, May 5, 2009 — At least 15 of the nation’s 19 banks undergoing federal stress tests this week would fail a stricter test based on more objective economic assumptions and stricter evaluation procedures, according to an analysis released today at the National Press Club by Martin D. Weiss, Ph.D., president of Weiss Research, Inc.
“The stress tests results are akin to ratings,” declared Weiss, formerly the president of a national rating agency. “But no objective rating agency would stand behind them. The exams are too easy; the banks get to take them home with cheat sheets; and if they don’t like their final grade, they can appeal for a better one. If, despite all this, some large institutions still come up short on capital, it will imply far deeper troubles than the Treasury or the Fed dare admit.”
Based on data provided by TheStreet.com Ratings, by the Comptroller of the Currency (OCC), and in first quarter financial statements, Weiss offers the following evaluations for the 19 institutions undergoing federal stress tests:
[With Dr. Weiss' evaluation from a stricter model.]
|
Institution
|
Assets ($Bil.)
|
Evaluation
|
|
J.P. Morgan Chase & Co.
|
2,079
|
Risk of failure
|
|
Citigroup
|
1,823
|
Risk of failure
|
|
Wells Fargo & Co.
|
1,286
|
Risk of failure
|
|
Goldman Sachs Group
|
885
|
Risk of failure
|
|
GMAC LLC
|
189
|
Risk of failure
|
|
SunTrust Banks Inc.
|
179
|
Risk of failure
|
|
Fifth Third Bancorp
|
119
|
Risk of failure
|
|
Bank of America Corp.
|
2,322
|
Borderline
|
|
Morgan Stanley
|
659
|
Borderline
|
|
PNC Financial Services Group
|
286
|
Borderline
|
|
US Bancorp
|
264
|
Borderline
|
|
BB&T Corp.
|
143
|
Borderline
|
|
Regions Financial Corp.
|
142
|
Borderline
|
|
American Express Co.
|
121
|
Borderline
|
|
Keycorp
|
98
|
Borderline
|
|
MetLife
|
502
|
Adequate capital
|
|
Bank of NY Mellon Corp.
|
203
|
Adequate capital
|
|
Capital One Financial Corp
|
177
|
Adequate capital
|
|
State Street Corp.
|
142
|
Adequate capital
|
Read the whole story…
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"Is Your Bank Solvent?"
