Tags: buybacks, Citigroup, JPMorgan, Too Big To Fail
They may still be too big and fragile, but banks are throwing their considerable weight around and getting their way.
Citigroup Inc. will seek permission for its first share buyback since 2007 as part of the latest Federal Reserve “stress tests,” according to people familiar with the company’s plans….
J.P. Morgan Chase & Co., the largest U.S. bank by assets, is expected to submit a plan that calls for both a dividend rise and a share repurchase despite more than $6 billion in trading losses during 2012, said a person familiar with the company’s plans.
Citigroup and Ohio’s Fifth Third Bancorp, both of which had capital requests rejected by the Fed last year, are among the institutions that intend to ask for dividend increases or buybacks. Morgan Stanley isn’t expected to ask for a dividend or buyback, focusing instead on winning Fed approval to complete this year a plan to take full ownership of a wealth-management unit.
The Basel Committee on Banking Supervision, a group of the world’s top regulators and central bankers, said Sunday that it agreed to relax a rule designed to ensure that big banks are able to weather financial crises without running short of cash. Bowing to two years of intense pressure from the banking industry, the regulators made it easier for banks to meet the rule, known as the “liquidity coverage ratio,” and delayed its full implementation until 2019.
Banks Are Still Too Big and Fragile, Economist Says [WSJ Real Time Economics blog]
Big Banks Readying Payout Plans [WSJ]
Rules for Lenders Relaxed [WSJ]