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12/18/2020, 10:48 PM (Source: TeleTrader)
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Fed to let large banks buy back shares

The United States Federal Reserve announced on Friday that large banks in the country will be able to buy back their shares as of the start of 2021, but with some limitations.

Banks will only be able to go forward with share repurchases and dividend payments in the amount of their income over the past year. However, if a company doesn't earn any income, it will not be allowed to buy back shares or pay dividends.

The decision was announced following the central bank's latest stress test. Commenting on the results, Vice Chair for Supervision Randal Quarles said: "The banking system has been a source of strength during the past year and today's stress test results confirm that large banks could continue to lend to households and businesses even during a sharply adverse future turn in the economy."

Breaking the News / VP