US Banking System Faces $541 Trillion Exodus in 'Severely Adverse' Scenario, Warns Federal Reserve

The Federal Reserve has warned that in a "severely adverse" scenario, over $541 billion will exit the US banking system. The annual bank stress test revealed that while large US banks would survive a severe recession, a group of 23 banking giants, including JPMorgan Chase, Bank of America, and Wells Fargo, would experience significant losses. These losses include $424 billion in loan losses, $18 billion in additional losses, $94 billion in trading and counterparty losses, and $5 billion in securities losses. Despite the potential losses, all 23 banks tested remained above their minimum capital requirements during the hypothetical recession.