Will Your Bank Survive A Recession? What You Need To Know

"The FED determined they all had enough capital on hand to survive a recession or Market shock."

"They assume that unemployment rate would spike to 10 percent... They assume an 8.75 percent decline to the GDP and they assume the stock market would Fall by 45 percent They also assume the vix would reach 75."

"And they also assumed that real estate could lose 38 to 40 percent from 2022 to 2024."

"Citizens Bank came out to be the weakest at 6.4 percent in their piggy bank and the strongest bank with the least risk was Charles Schwab at 22.8 percent."

"but ultimately the real question is this how much is 540 billion dollars to me an average person a hundred billion dollars worth of losses would sound like a lot but what does that actually mean The FED defines this as a severely adverse scenario"

"it's exactly why even though we have all of these stress tests in place the smaller Regional Banks still failed even though there were actually warning signs and we knew that some of these Banks were weak they still flew onto the radar because they were too small"

"to get the a in this case in other words to be considered well capitalized after this stress test a bank that's considered systematically too big to fail needs to have left at least 10 percent of total assets inside of this piggy bank"

"the best grade you can get a passing grade in this case a d or the minimum to be compliant is actually 4.5"

"what this test showed is that the banks could lose 540 billion dollars worth and still continue to be operational and still give out loans to people"

"there were some C student Banks"