Federal Reserve stress test may be illegal: banking group
- Wall St. gains across sectors ahead of Trump inauguration
- Walgreens Boots Alliance (WBA) Said to Face Antitrust Concern for Rite Aid (RAD) Fix - Bloomberg
- Bristol-Myers Squibb (BMY) Says It Won't Pursue Accelerated U.S. Regulatory Pathway for Opdivo Plus Yervoy in Lung Cancer
- Herbalife (HLF) Says SEC Requested Documents on Anti-Corruption Compliance in China; Reviewed with DoJ
- Investment Focus: History suggests Trump month will be stocks down, dollar up
The facade of the U.S. Federal Reserve building is reflected on wet marble during the early morning hours in Washington, July 31, 2013. REUTERS/Jonathan Ernst
Get access to the best calls on Wall Street with StreetInsider.com's Ratings Insider Elite. Get your Free Trial here.
By Olivia Oran
(Reuters) - The Federal Reserve may have violated the law in adopting key parts of the bank stress tests, according to a study released on Thursday from a group whose members include large Wall Street banks.
The paper from the Committee on Capital Markets Regulation, a not-for-profit organization whose members include executives from banks including Goldman Sachs Group Inc (NYSE: GS), JPMorgan Chase & Co (NYSE: JPM), Wells Fargo & Co (NYSE: WFC) and UBS Group AG
It is rare for banks to sue their regulators but sources familiar with the matter have said that a potential lawsuit is being considered.
The report says that the Fed has likely not complied with the so-called Administrative Procedure Act which states that federal agencies must provide the public notice of proposed rules and an opportunity to comment on them.
The Fed's annual stress tests, known as CCAR, evaluate if the largest U.S. bank holding companies have enough capital to withstand an unforeseen crisis, with stock markets dropping precipitously.
Since the financial crisis, regulators have been increasing capital requirements for banks with the intention of making the financial system safer.
This year, 31 out of 33 U.S. banks passed the stress tests.
(Reporting by Olivia Oran in New York; Editing by Chris Reese)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- U.S. bankers tell Europeans to think positively on Trump
- UPDATE: UBS Downgrades ExxonMobil (XOM) to Sell
- Pre-Open Stock Movers 01/20: (SWKS) (EMES) (CF) Higher; (PSTI) (AFMD) (BMY) Lower (more...)
Create E-mail Alert Related CategoriesReuters
Related EntitiesUBS, JPMorgan, Goldman Sachs, Wells Fargo
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!