UPDATE 1-US banks to get test appeal decisions May 1-source

Fri Apr 24, 2009 10:02pm BST
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(Adds Fed comments, byline)

By Karey Wutkowski

WASHINGTON, April 24 (Reuters) - The top 19 U.S. banks that have been stress tested will receive the results of any appeals they submit about regulators' assessments next Friday, according to a source familiar with regulatory talks.

The banks have also been given a "harsh gag order" to prevent them from leaking any information about preliminary test results to the media, the source said, speaking anonymously because the regulatory conversations were not public.

The Federal Reserve on Friday released a document describing the methodologies underlying the tests, which are designed to determine the largest banks' capital needs if the economy deteriorates further. The government has said it will release the results in some form on May 4.

The institutions undergoing stress tests include Bank of America Corp (BAC.N: Quote, Profile, Research), Goldman Sachs Group Inc (GS.N: Quote, Profile, Research), Morgan Stanley (MS.N: Quote, Profile, Research), MetLife Inc (MET.N: Quote, Profile, Research), PNC Financial Services Group Inc (PNC.N: Quote, Profile, Research), US Bancorp (USB.N: Quote, Profile, Research), Bank of NY Mellon Corp (BK.N: Quote, Profile, Research), SunTrust Banks Inc (STI.N: Quote, Profile, Research), State Street Corp (STT.N: Quote, Profile, Research), Capital One Financial Corp (COF.N: Quote, Profile, Research), BB&T Corp (BBT.N: Quote, Profile, Research), Regions Financial Corp (RF.N: Quote, Profile, Research), American Express Co (AXP.N: Quote, Profile, Research), Fifth Third Bancorp (FITB.O: Quote, Profile, Research), Keycorp (KEY.N: Quote, Profile, Research) and GMAC LLC (GKM.N: Quote, Profile, Research).

The banks were briefed by regulators on Friday on the supervisors' results of the stress tests. The institutions have done their own version of the exam and will spend the next few days consulting with their supervisors about the results.

The Fed declined to comment on when banks will hear about the outcome of any appeals they submit to the supervisors.

Officials said on Friday the top banks need to hold a "significant" capital cushion above the regulatory capital requirements.

They said examiners have already determined what capital buffers the 19 banks will need if economic conditions deteriorate further, but declined to say what metrics they used to determine the buffer amounts. (Reporting by Karey Wutkowski with additional reporting by Mark Felsenthal; Editing by Andre Grenon)

 
 
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