Based on their performance, the 19 banking companies evaluated can increase their dividends and other distributions.
The stress test scenario includes the unemployment rate rising to 13 percent, stock prices dropping 50 percent and housing prices falling 21 percent.
In such a scenario, most of the largest U.S. banks would continue to be able to lend to households and businesses, the Federal Reserve said.
Fifth Third Bancorp, JP Morgan Chase & Co., KeyCorp, The PNC Financial Services Group Inc. and U.S. Bancorp were among 15 of the 19 bank holding companies that passed the test.
These companies are among the top five market leaders in Dayton and Cincinnati by deposits, according to the Federal Deposit Insurance Corp.
Ally Financial Inc., Citigroup Inc., MetLife Inc. and SunTrust Banks Inc. failed at least one of four criteria in the Reserve’s test scenario.
U.S. Bank on Tuesday approved a 56-percent dividend increase to 19.5 cents per share of common stock, to be paid April 16 to shareholders of record as of March 30, the company said.
U.S. Bank is currently the largest bank by deposits in the Cincinnati metro area.
“Looking ahead, we continue to see a slow, but steady, economic recovery, and we look forward to participating in the revitalization of our markets,” said Minneapolis, Wisc.-based U.S. Bancorp Chairman, President and CEO Richard Davis in a statement with the release.
Fifth Third of Cincinnati, the largest bank by deposits in the Dayton metro and second-largest in the Cincinnati metro, declared a quarterly dividend on preferred stock.
New York-based JP Morgan Chase & Co. announced it would increase its quarterly dividend by 5 cents to 30 cents per share of common stock.
KeyCorp, headquartered in Cleveland, announced a stock buyback and said its board of directors at a May meeting will consider a common stock dividend hike.
Contact this reporter at (513) 705-2551 or clevingston@coxohio.com.
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