News / USA

Federal Reserve: Almost All Big US Banks Could Withstand Economic Jolt

Federal Reserve Chair Janet Yellen speaks during her first news conference at the Federal Reserve in Washington, March 19, 2014.
Federal Reserve Chair Janet Yellen speaks during her first news conference at the Federal Reserve in Washington, March 19, 2014.
VOA News
The U.S. central bank has concluded that almost all of the country's biggest banks could withstand a severe economic downturn.

The Federal Reserve said that 29 of the country's 30 biggest banks -- excluding a regional bank in the western U.S. -- have enough money on hand to withstand a hypothetical deep recession. Such a downturn would include a sharp rise in unemployment, a nearly 50 percent drop in the country's major stock indexes and a steep drop in home prices.

The central bank said the annual survey of the banks shows broad improvement in their financial standing since the country's recession five years ago, its worst in seven decades.

Analysts say that the better outlook for the banks could allow them to again pay dividends to their shareholders for the first time in recent years. One survey of bank profits showed that the six biggest U.S. banks earned $76 billion in profits last year, close to their collective all-time high.

Meanwhile, the Fitch credit rating agency has issued a AAA rating with a stable outlook for the United States.

Fitch made the announcement Friday, saying the new action resolved the negative watch the U.S. received in October.

The agency noted that last year's U.S. debt ceiling crises had not negatively affected U.S. bond yields or reduced foreign holdings of Treasury securities. Fitch said, "therefore Fitch does not believe the role of the U.S. dollar, sovereign financing flexibility or debt tolerance has been materially damaged." The ratings agency said the U.S. has achieved "strong fiscal consolidation."

The agency said the U.S. economy is one of the most "productive, dynamic and technologically advanced in the world," underpinned by strong institutions, a favorable business climate and efficient product and labor markets.

Fitch said the U.S. has greater debt tolerance than its AAA peers, owing to the "unparalleled financing flexibility provided by being the issuer of the world's pre-eminent reserve currency and benchmark fixed income asset."

Fitch said the country's capital markets are "the deepest and most liquid in the world."

Some information for this report was provided by Reuters.

You May Like

Mali's Female Basketball Players Rebound After Islamist Occupation

Islamist extremists ruled northern Mali for most of 2012, imposing strict Sharia law, and now some 18 months later, the region is slowly getting back on its feet More

Video Vietnamese Staging Chinese Product Boycott After Oil Rig Spat

Many Chinese-made products go unsold, for now, with numerous Vietnamese consumers still angry over recent dispute More

Koreas Mark 61st Anniversary of War Armistice

Muted observances on both sides of heavily-armed Demilitarized Zone that separates two decades-long enemies More

This forum has been closed.
Comment Sorting
Comments
     
by: Not Again from: Canada
March 24, 2014 10:10 AM
Great care must be taken, by economic leaders, not to become speculators, and even worse doomsday predictors. Witchcraft/hairy fairy based pronostications have no place by those in charge of US/Global international/national financial institutions, especially when the markets are weak, recovery is taking place very slowly, and environmental factors, this past Winter have in fact slowed down some outputs. Stability starts at the barain and mouth of those that have the economic levers. Crying wolf, may actually attract the wolf, especially when the wolf is nearby and hungry.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Students in Business for Themselvesi
X
Mike O'Sullivan
July 26, 2014 11:04 AM
They're only high school students, but they are making accessories for shoes, fabricating backpacks and doing product photography - all through their own businesses. It's the result of a partnership between a non-profit organization that teaches entrepreneurship and their schools. VOA's Mike O'Sullivan and Deyane Moses met the budding entrepreneurs near Los Angeles.
Video

Video Students in Business for Themselves

They're only high school students, but they are making accessories for shoes, fabricating backpacks and doing product photography - all through their own businesses. It's the result of a partnership between a non-profit organization that teaches entrepreneurship and their schools. VOA's Mike O'Sullivan and Deyane Moses met the budding entrepreneurs near Los Angeles.
Video

Video Astronauts Train in Underwater Lab

In the world’s only underwater laboratory, four U.S. astronauts train for a planned visit to an asteroid. The lab - called Aquarius- is located five kilometers off Key Largo, in southern Florida. Living in close quarters and making excursions only into the surrounding ocean, they try to simulate the daily routine of a crew that will someday travel to collect samples of a rock orbiting far away from earth. VOA’s George Putic has more.
Video

Video Not Even Monks Spared From Thailand’s Junta-Backed Morality Push

With Thailand’s military government firmly in control after May’s bloodless coup, authorities are carrying out plans they say are aimed at restoring discipline, morality and patriotism to all Thais. The measures include a crackdown on illegal gambling, education reforms to promote students’ moral development, and a new 24-hour phone hotline for citizens to report misbehaving monks. Steve Sandford reports from Bangkok.
Video

Video Virtual Program Teaches Farming Skills

In a fast-changing world beset by unpredictable climate conditions, farmers cannot afford to ignore new technology. Researchers in Australia are developing an online virtual world program to share information about climate change and more sustainable farming techniques for sugar cane growers. As VOA's Zlatica Hoke reports, the idea is to create a wider support network for farmers.
Video

Video Airline Expert: Missile will Show Signature on Debris

The debris field from Malaysia Airlines Flight 17 is spread over a 21-kilometer radius in eastern Ukraine. It is expected to take investigators months to sort through the airplane pieces to learn about the missile that brought down the jetliner and who fired it. VOAs Carolyn Presutti explains how this work will be done.
Video

Video Treatment for Childhood Epilepsy Heats up Medical Marijuana Debate

In the United States, marijuana is classed as an illegal drug by the federal government. But nearly half the states have legalized it, to some degree. Proponents say some strains of marijuana might have exceptional health benefits, for treating pain or inflammation in chronic conditions such as cancer, multiple sclerosis and epilepsy. Shelley Schlender reports on a strain of medical marijuana developed in Colorado that is reputed to reduce seizures in childhood epilepsy
Video

Video Airbus Adds Metal 3D Printed Parts to New Jets

By the end of this year, European aircraft manufacturing consortium Airbus plans to deliver the first of its new, extra-wide-body passenger jets, the A350-XWB. Among other technological innovations, the new plane will also incorporate metal parts made in a 3-D printer. VOA's George Putic has more.
Video

Video AIDS Conference Welcomes Exciting Developments in HIV Treatment, Prevention

Significant strides have been made in recent years toward the treatment and prevention of HIV, the virus that causes AIDS. This year, at the International AIDS Conference, the AIDS community welcomed progress on a new pill that may prevent transmission of the deadly virus. VOA’s Anita Powell reports from Melbourne, Australia.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.

AppleAndroid