Fed says stress test results to be released on March 20

WASHINGTON Tue Feb 25, 2014 3:13pm EST

WASHINGTON (Reuters) - Financial regulators plan to release on March 20 the results of annual stress tests, which weigh banks' ability to withstand an economic crisis, the Federal Reserve said on Tuesday.

Regulators have made stress testing a central part of their efforts to ensure banks are safer after the 2007-2009 financial crisis. The tests look at whether banks have a big enough capital cushion to survive a downturn.

This year, eight large banks also were required to show how they would cope with the hypothetical default of their largest trading partner.

The Fed also uses stress tests to evaluate banks' plans to pay dividends or buy back shares. Officials can reject new distributions if they think those plans would pose risks to the banks' stability.

The results of the capital plan reviews will be released on March 26, the Fed said.

Thirty of the biggest U.S. banks were part of this year's tests, 18 of which participated in previous rounds.

Last year, the Fed initially vetoed submissions by BB&T Corp (BBT.N) and Ally Financial.

It also ordered JPMorgan Chase (JPM.N) and Goldman Sachs (GS.N) to fix "weaknesses" in their capital planning processes, although they were allowed to move forward with their capital distribution plans.

The Fed later approved revised plans filed by all four banks.

(Reporting by Emily Stephenson; Editing by Sandra Maler and Dan Grebler)

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