Goldman Sachs Group Inc's key capital ratio would be higher in its own stress test compared with a projection released by the Federal Reserve, according to a document posted on the bank's website on Thursday.
Goldman said its Tier 1 common ratio would drop to a minimum of 8.6 percent under extremely stressed economic conditions, whereas the Fed projected that ratio would drop as low as 5.8 percent for the Wall Street bank.
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In order to pass the Fed's stress test, 18 large U.S. banks had to meet a minimum Tier 1 common ratio of 5 percent.
Goldman and its Wall Street rival Morgan Stanley fared worse than any banks except Ally Financial Inc , according to the Fed's analysis. Most banks later said their internal calculations turned up better results.
Not all of Goldman's calculations resulted in higher capital ratios. Its total risk-based capital ratio fell to a minimum of 13.2 percent under its own analysis, whereas the Fed projected that ratio could fall to a minimum of 11.3 percent for Goldman.
Goldman also projected lower losses in a stress scenario, but noted that the stress test does not take into consideration actions that management could take to reduce expenses, such as cutting compensation.
(Reporting By Lauren Tara LaCapra; Editing by Gary Hill)