TAMPA, Florida (Reuters) - Atlanta Federal Reserve President Dennis Lockhart said on Tuesday that the U.S. banking system remained under strain and it would be a number of months before there was clarity on its capital requirements.
"We are certainly not out of the woods in terms of stabilizing the banks and we have some months to go through (to) ...identify the capital needs...after stress-testing," Lockhart told the University of Tampa Fellow's Forum, referring to the country's top 19 banks.
Lockhart is a voting member of the Fed's policy-setting committee this year.
The U.S. Treasury is subjecting the country's top banks to strict examination to understand how much additional capital they might need if a year-long U.S. recession gets much worse.
The Fed has cut interest rates to almost zero and more than doubled the size of its balance sheet to around $2 trillion through programs to support private lending.
Lockhart said he still expected growth to turn positive in the second half of this year, but warned this outlook was subject to "substantial" risks, citing the commercial real estate sector and weaker global growth.
Housing would also find a bottom this year as lower home prices and more affordable mortgage rates stimulate demand, but confidence will dictate when this turn comes.
"The purchaser simply has to believe that it is time to act," Lockhart said.
