Bernanke: U.S. Financial System Is Much More Resilient
Federal Reserve Chairman Ben Bernanke is on a mission to impress upon the financial community that the central bank’s periodic stress tests on banks have made the financial system much more resilient. To make that point clear, he contrasted the current state of banks to their tattered condition in 2009 after the financial crisis undercut their stability.
“The results of the most recent stress tests and capital planning evaluations continue to reflect improvement in banks’ condition,” Bernanke said Monday at a conference on financial stability sponsored by the Atlanta Federal Reserve Bank, covered by Bloomberg. Stress tests have not only shown the improving condition of United States financial institutions, but have actually strengthened the system, he asserted.
In the four years that have passed since the financial crisis, America’s largest financial institutions have been under intense legal and regulatory scrutiny. After the financial crisis, politicians and regulators searched for a means to repair the structural problems within the international banking system in order to ensure that a similar financial meltdown would never happen again and that taxpayers would never have to repeat the bank bailout.
Banks like Bank of America (NYSE:BAC), Citigroup (NYSE:C), and JPMorgan Chase (NYSE:JPM), which were among the 19 institutions tested, represent more than more than 70 percent of the assets in the U.S. banking system. But Bernanke is committed to forever banishing the idea that such banks are “too big to fail”…