WSJ: Banks throw fit over stress test results, Fed caves

NoOneLikesUs · May 9, 2009

"Go back to bed America. Your government is in control." - Bill Hicks

http://online.wSportsJournalists.com/article/SB124182311010302297.html

When the Fed last month informed banks of its preliminary stress-test findings, executives at corporations including Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. were furious with what they viewed as the Fed's exaggerated capital holes. A senior executive at one bank fumed that the Fed's initial estimate was "mind-numbingly" large. Bank of America was "shocked" when it saw its initial figure, which was more than $50 billion, according to a person familiar with the negotiations.

At least half of the banks pushed back, according to people with direct knowledge of the process. Some argued the Fed was underestimating the banks' ability to cover anticipated losses with revenue growth and aggressive cost-cutting. Others urged regulators to give them more credit for pending transactions that would thicken their capital cushions.

At times, frustrations boiled over. Negotiations with Wells Fargo, where Chairman Richard Kovacevich had publicly derided the stress tests as "asinine," were particularly heated, according to people familiar with the matter. Government officials worried San Francisco-based Wells might file a lawsuit contesting the Fed's findings.
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cranberry · May 9, 2009

Better safe than sorry. I'm glad to know the Fed would choose to err on the conservative side. So fuck the whining bankers who were culpable in the mess to begin with.

poindexter · May 10, 2009

"The effect of this capital assessment will be to replace uncertainty with transparency"

-Tax cheat Timothy Geithner, April 21
http://www.upi.com/Business_News/2009/05/07/Geithner-touts-transparency-of-tests/UPI-19931241703229/

Fenian_Bastard · May 10, 2009

It's time for the stocks again.

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WSJ: Banks throw fit over stress test results, Fed caves

NoOneLikesUs Active Member

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WSJ: Banks throw fit over stress test results, Fed caves

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cranberry Well-Known Member

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