Sept 16 Wells Fargo & Co is sufficiently
capitalized to weather a hypothetical 'severely adverse
scenario', the bank's mid-cycle stress test results showed.
The bank's projected pro forma Tier 1 common equity ratio,
under Basel I, fell to a low of 9.9 percent during the
nine-quarter period through June 30, 2015.
The fourth-largest U.S. bank's severely adverse scenario
assumes an intense recession in the United States due to extreme
fiscal tightening domestically and a deep global recession, the
company said in a disclosure on its website on Monday. ()
Wells Fargo projects a minimum Tier 1 risk-based capital
ratio of 11.3 percent and minimum Tier 1 leverage ratio of 9
percent during the stress scenario.
The capital ratios are well above the minimum regulatory
requirements mandated by the Federal Reserve.
The bank estimated a cumulative pro-forma net loss of $3.8
billion before taxes for the nine-quarter test horizon.
Wells Fargo shares closed up 1.6 percent at $42.89 on the
New York Stock Exchange.