The Fed tested the 34 largest banks operating in the United States, looking at how their balance sheets would withstand sharp drops in asset prices and a total of $612 billion in losses, caused mostly by stress in commercial real estate values and in the markets for corporate debt. Each bank had enough capital to meet regulators’ minimum requirements, even in the worst-case scenario.
The tests have nothing to do with foreign debt in particular Chinese govt and private debt. The tests have nothing to do with Swaps particular with Chinese banks and other financials. The test might prove worthless. Very worthless. If you are invested in some of the 34 largest banks in the US you are waiting for the FED to say woops! How could we have missed that?