Report: AmEx, JPMorgan, Bank of New York Mellon pass tests

WASHINGTON -- Leaked results of the government's stress tests of 19 large banks boosted investor confidence Wednesday in the financial sector.

The emerging news is bringing into focus a picture of the financial industry's strength that has had investors guessing for months.

The stress tests were designed to see how the large banks and finance companies would fare if the economy worsens. Analysts expect about half the companies will be asked to raise capital.

Spokesmen for American Express, JPMorgan and Bank of New York Mellon would not comment. A spokesman for Regions Financial could not immediately be reached for comment.

David Skidmore, spokesman for the Federal Reserve, declined to comment on whether this constituted a violation of confidentiality policies pertaining to normal bank exams. A Treasury spokesman did not return requests for comment.

The stress tests are a centerpiece of the Obama administration's plan to stabilize the financial industry. They measure how much the banks would be hurt if unemployment rose to 10.3% and home prices dropped an additional 22%.

The government wants the firms to have enough money to keep lending even if the economy gets much worse. Officials have said none of the banks will be allowed to fold.

Bank of America stock rose Wednesday after reports that the company would need to raise $34 billion in additional capital and that the bank has the means to cover a potential $34 billion shortfall in capital. The New York Times and Wall Street Journal reported the figure. The Journal cited unnamed people familiar with the situation, while the Times quoted a bank executive.