Here are a couple highlights for a recent post over at Daily Reckoning regarding the bank stress test results.
- Banks need about $75 billion to reach “adequate capitalization”
- “Adequate capitalization” is when common equity equals 4%
- Common equity being at 4% means a debt-to-equity ratio of 25-to-1
- The current bank needs do not factor in the potential for bank assets to lose their value
- The current bank needs are based on a rosy worst case scenario of [Read more...]

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