Fed to Banks: Keep Quiet on Stress Tests

Officials worry leaked results will cause market chaos
By Kevin Spak,  Newser Staff
Posted Apr 10, 2009 12:38 PM CDT
In this March 24, 2009, photo, Treasury Secretary Timothy Geithner, left, accompanied by Federal Reserve Chairman Ben Bernanke, testifies on Capitol Hill.   (AP Photo)
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(Newser) – The Federal Reserve is adopting a loose-lips-sink-ships policy when it comes to the “stress tests” being administered to big US financial firms. Goldman Sachs, Citigroup, and others have been ordered to keep quiet about their financial report cards, Bloomberg reports. Officials fear that should those results leak, investors would bail on the stock of any companies that look weak.

“If you allow banks to talk about it, people are just going to assume that the ones that don’t comment about it failed,” said one analyst. The tests are supposed to determine whether companies have enough capital to ride out the economic storm, particularly if the economy continues to shrink.