Healthy State of U.S. Banks

According to an article, although many European banks are tightening their credit in an effort to ensure funding, American banks are now in a good position to lend and have become fairly healthy since the downturn of 2008. The concept that U.S. banks are now doing well can be shown by the fact that they are distanced from the suffering economies of Europe and most have capital exceeding regulatory requirements. Federal efforts to spark growth in the economy have included buying bonds and creating money for bank reserve accounts and, as a result, the largest banks in the country now have liquid assets that are 3 to 11 times short term borrowings. The most interesting aspect of this article is the fact that it still cautions the U.S. economy about negative consequences of the poor state of banks in Europe. Regardless of how healthy our economy may be, a banking crisis in Europe will still have a very damaging impact on the U.S. financial system.

http://www.economist.com/node/21541020