WASHINGTON – The Federal Reserve’s annual “stress tests” of major U.S. banks have become better able to detect risks, Chairman Ben Bernanke said Monday.
Bernanke also said the tests show that the banking industry has grown much healthier since the financial crisis.
Speaking in Atlanta, Bernanke noted that this year’s tests showed that 18 of the biggest banks had collectively doubled the cushions they hold against losses since the first tests were run in 2009. He said the tests are providing vital information to regulators.
The latest test results were released last month. They showed that all but one of the 18 banks were better prepared to withstand a severe U.S. recession and an upheaval in financial markets.