FINANCIAL TIMES: The Federal Reserve has vetoed the US capital plans of Deutsche Bank and Santander in a stinging rebuke for the European banks even as US lenders got the green light to launch their biggest payouts to shareholders since the financial crisis.
US operations of Deutsche, Germany’s largest bank, and Santander, the biggest bank in Spain, were found to have serious deficiencies in capital planning and risk management, according to a senior Fed official.
The official said that any bank with chronic problems in those areas could eventually face a cease-and-desist order, compelling them to make specific changes or pay financial penalties. Santander has now failed the test — known as the Comprehensive Capital Analysis and Review (CCAR) — two years in succession; Deutsche was tested for the first time this year… (more)
EDITOR: If we can’t break them up, at least we can make them safer by insisting on adequate reserves and equity.
