Stress Test Follow-Up

I could not find a solid answer on the basis of whether quarterly results were included in the anticipated capital calculations. However Friday morning on Squawk Box it was mentioned that the results included estimated normal profits. So the question becomes, is the estimate reasonable? If it's too low, banks will need more, if it's too high banks will need less capital. Fortunately from the accounting standpoint, the Fed is requiring the capital raising plans to be delivered within 30 days and with a timeline not to exceed 6 months, which takes pressure off of the reporting of the bank's financial results (at least for now).

A couple different views-
Economist.com thinks the capital levels may have been set too low.

The Wall Street Journal has an article on the back and forth that occurred to keep the stress tests from being worse and requiring banks to raise additional capital.

So today was the day

I have not had time to review the entire report, but if Fast Money on CNBC had it right during their coverage, the one thing that this showed, is the potential impact of the the credit card debt. Besides that, is seemed that the minimum additional capital requirement were not as bad as expected.

I'm still not sure on the exact details, I seem to remember hearing that the capital requirements were all based on 12/31/08 numbers, if that's true for the banks that claim a profit as of 3/31, perhaps the capital requirements have already gone down. I'll have to see if anything comes out about this and post what I find in the next couple days.

Stress Test Results

Seems that one (unnamed) bank failed the stress test, we'll like discover which one as soon as the market opens on Monday morning. I'm guessing Citigroup or Bank of America, but time will tell. Official results will be released on May 4th.

A few more articles on the stress tests...at NY Times and Businessweek.