Fed: Most US Banks Well Capitalized...

According to CNBC.com:

The Federal Reserve, releasing details of how it conducted "stress tests" on the nation's 19-largest financial institutions, said "most banks" are currently well capitalized but need to hold a "substantial" amount above regualtory requirements in case the recession worsens. “Most banks currently have capital levels well in excess of the amounts needed to be well capitalized," the Fed said in its eagerly awaited report.

WSJ reports:

WASHINGTON – The Federal Reserve on Friday said any banks directed to raise new capital as a result of the government's stress tests should not be viewed as insolvent or unviable, one way government officials are trying to manage the potential fallout from the high-stakes exams. The central bank released the methodology of its stress tests Friday, the same day bank executives across the country huddled with Fed officials to go over their results. The Fed is sharing with the banks how much capital each company might need to raise to satisfy regulators that they can continue lending if the economy worsens significantly next year. Banks will have several days to challenge the findings before the government makes results public the week of May 4.

And first reactions (equities are happy!) developing: http://paul.kedrosky.com/archives/2009/04/lots_of_testing.html http://zerohedge.blogspot.com/2009/04/fed-releases-stress-test-assumptions.html http://dealbreaker.com/2009/04/stress-kills.php http://247wallst.com/2009/04/24/stress-test-criteria-very-conservative/
http://www.portfolio.com/views/blogs/market-movers/2009/04/24/stressful-enough?tid=true
http://blogs.wsj.com/marketbeat/2009/04/24/sell-no-wait-buy/
http://www.ritholtz.com/blog/2009/04/stress-test-white-paper/


Chart courtesy of Yahoo.com, click to enrlarge, intra-day view. Blue line is S&P500 Financial Sector Index, red line - S&P500 Index.

Bulls should not hide in the caves, the "somewhat" weakness in the final minutes should be attributed to weekend... and some weaker hands just realizing profits? And, surely, this provides the opportunity to buy cheaper than 10 minutes before cash market closing?