NEW YORK, March 7 Goldman Sachs Group Inc's
key capital ratio would be higher in its own stress test
compared with a projection released by the Federal Reserve,
according to a document posted on the bank's website on
Goldman said its Tier 1 common ratio would drop to a minimum
of 8.6 percent under extremely stressed economic conditions,
whereas the Fed projected that ratio would drop as low as 5.8
percent for the Wall Street bank.
In order to pass the Fed's stress test, 18 large U.S. banks
had to meet a minimum Tier 1 common ratio of 5 percent
Goldman and its Wall Street rival Morgan Stanley
fared worse than any banks except Ally Financial Inc,
according to the Fed's analysis. Most banks later said their
internal calculations turned up better results.
Not all of Goldman's calculations resulted in higher capital
ratios. Its total risk-based capital ratio fell to a minimum of
13.2 percent under its own analysis, whereas the Fed projected
that ratio could fall to a minimum of 11.3 percent for Goldman.
Goldman also projected lower losses in a stress scenario,
but noted that the stress test does not take into consideration
actions that management could take to reduce expenses, such as