The Federal Reserve’s 2026 stress test cleared all 32 of the largest U.S. banks in late June, even under a worst-case scenario that assumed about $700 billion in loan losses. Despite that scenario, every bank stayed above the minimum capital requirement.
That result quickly led to a wave of dividend increases across the sector, with several banks rolling out double-digit hikes within days. A key metric here is the Common Equity Tier 1 (CET1) ratio, which must stay above 4.5%, and many banks showed they had far more capital than needed, even in a downturn.
