Get Ready for a Bank Stock Bonanza
Banks and their investors got very good news yesterday. The results of the Fed Stress tests came out, and banks have been approved for what looks like a cash-back bonanza. The banks passed the tests with flying colors and the Fed saw no reason to constrain payouts to investors. This means that banks have been cleared for a ~$100 bn cash giveaway in the form of buybacks and dividends. Bank stocks unsurprisingly rallied on the news. JP Morgan, for instance, plans to give out 110% of profits over the next 12 months.
FINSUM : This should be a big boost for bank stocks and their investors and seems to signal an inflection point towards a new era for banks. Are we finally out of "post-Crisis" mode?
- stress tests