Fed: Three banks fail recession scenario (by Ronald D. Orol)

WASHINGTON (MartetWatch) - Ally Financial Inc., Citigroup Inc. and SunTrust were estimated not to have maintained sufficient capital ratios under a hypothetical deep recession scenario the Federal Reserve created to evaluate whether banks have reserves necessary to withstand another crisis like the credit crunch of 2008. The three banks had less than a 5% stressed ratio of tier 1 common capital with all the proposed capital actions through the fourth quarter of 2013. Ally Financial Inc. held a stressed ratios of 2.5%,, SunTrust Banks Inc. (sti) had a ratio of 4.8% and Citigroup Inc. (c) 4.9%. Losses at the 19 bank holding companies are estimated to total $534 billion during the nine quarters of the hypothetical stress scenario, the Fed said. The Fed added that a fourth bank didn't meet required levels but it was unclear which institution it was.