Wall Street banks are awaiting the announcement of regulatory stress test results expected later this month with bated breath. But their investors are waiting with their wallets open.
After the Federal Reserve's Comprehensive Capital Analysis and Review test results are announced, Fitch Ratings analysts think that "credit card banks" may fare best. In the prior four years, the banks with the largest credit card businesses performed better in regulatory exams as a group, analysts noted.
And this could lead to billions in payouts for banks' investors, Fitch said. Capital requests, or what banks ask regulators for permission to pay out to investors, are set to rise this month via the stress tests because most banks will score passing grades with the Fed, according to Fitch.
"Banks have become more comfortable with the process and creative with their capital requests," the analysts wrote.