Goldman Sachs: Teacher’s Pet


Wall Street’s banks were pretty hard on themselves for this year’s choose-your-own-misadventure stress-test trial runs, conjuring a way worse recession than they did last year, and doing concomitantly worse as a result. Citigroup’s Tier 1 would fall from 9.1% to 8.7%, JPMorgan’s from 8.5% to 8.4%, Morgan Stanley’s from 9.5% to 8.9% and Wells Fargo’s from 9.9% to 9.6%.

But not everyone’s doing so badly, even when they were really, really hard on themselves.

Goldman projected its ratio would be 10.1%, compared with an 8.9% projection last year….

Bank of America Corp. on Monday predicted it would have the same capital level—8.4%—under a stressed scenario as it did last year. Under the latest scenario however, the Charlotte, N.C., lender created a tougher hypothetical recession for itself on certain fronts.

Citigroup, Other Banks Release Midyear Stress-Test Results [WSJ]