WASHINGTON--The U.S. Federal Reserve said Tuesday it would grant
four large banks six more months to revise their capital plans
after the banks requested more time.
The central bank granted the delay to Citigroup Inc. (C), and
the U.S units of HSBC Holdings PLC (0005.HK), Royal Bank of
Scotland Group PLC (RBS.LN) and Banco Santander SA. The banks,
under "stress tests' conducted earlier this year, were required to
submit revised capital plans and suspend dividend payments.
Instead of being required by June 26, the new plans will be
required by Jan. 5, the central bank said.
The extensions, which the banks requested, "will give the firms
additional time to address the capital planning weaknesses
identified by the Federal Reserve," the central bank said. The
banks won't be able to buy back shares or pay dividends until the
Fed approves a new capital plan.
Zions Bancorp (ZION), the fifth bank that was rejected by the
Fed, has already resubmitted its capital plan and didn't request a
delay, a Fed spokeswoman said.
Zions Chairman and Chief Executive Harris Simmons said during an
investor conference in May that the company submitted a new stress
test to the Federal Reserve on April 30. Bank executives have since
said they expected to receive a response from the Fed by July
15.
Write to Alan Zibel at Alan.Zibel@wsj.com
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