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The 10 Worst Fed Stress Test Scores

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Shareholders of the 31 banks stress tested by the Federal Reserve this year are relieved to hear the news that all 31 banks have "passed" the test.

Zions Bancorporation (NASDAQ: ZION), the only bank last year to fail the test, can attest to the importance of obtaining a passing score.

This year's stress test included hypothetical economic conditions involving a 60 percent drop in the stock market and a 25 percent drop in housing prices. All banks were required to maintain at least a 5 percent tier-one capital ratio under stressful conditions.

The 10 best scores are listed here.

Below are the 10 worst-performers, based on the minimum tier-one capital ratios of the banks.

1. Zions Bancorporation: 5.1
2. Morgan Stanley (NYSE: MS): 6.2
3. The Goldman Sachs Group (NYSE: GS): 6.3
4. BBVA Compass Bancshares Inc (NYSE: BBVA): 6.3
5. JPMorgan Chase & Co (NYSE: JPM): 6.5
6. Bank of America Corp (NYSE: BAC): 7.1
7. M&T Bank Corp (NYSE: MTB): 7.3
8. Wells Fargo & Co (NYSE: WFC): 7.5
9. Ally Financial Inc (NYSE: ALLY): 7.9
10. Fifth Third Bancorp (NASDAQ: FITB): 7.9

Disclosure: The author owns shares of Bank of America and Wells Fargo.

 

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