Market Overview

The 10 Worst Fed Stress Test Scores


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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