Nearly all of the largest US banks are on steady enough footing to increase payouts to shareholders, the US Federal Reserve said on Wednesday, with just two subsidiaries of foreign banks failing its annual stress test.
The results show that big US banks have not only built up significant capital since the 2007-2009 financial crisis but that management teams have largely proven the merit of their internal disaster planning to the Fed.
However, the Fed criticised some elements of Morgan Stanley's capital planning process - but still allowed the bank to move ahead with plans for a $3.5 billion stock repurchase program and a quarterly dividend hike while it rectifies the issues.
The regulatory thumbs up prompted a slew of announcements from banks who plan to buy back more stock or increase dividends - good news for investors who saw their banks shares hammered by Britain's vote last week to leave the European Union.
