Although Stein rejected the notion the Fed's change in communication was intended to cool overheated credit markets, his belief that the central bank's bond buying hasn't been undermined expresses confidence in the standing of the nation's largest banks.

Even if the Fed hadn't meant for a June rise in interest rates to impact large banks, many investors see the market move as beneficial to firms such as Wells Fargo ( WFC), JPMorgan ( JPM), Citigroup ( C) and Bank of America ( BAC).

For example, a rise in mortgage rates spurring losses on banks' available for sale (AFS) portfolios might push them to slow their securities buying and increase their lending, Fitch Ratings financial institutions managing director Joo-Yung Lee said at a Tuesday conference.

Rising mortgage yields and short term rates kept low by weak commodity prices would be "nirvana for banks," Bill Smead, chief investment officer of Smead Capital said in a Thursday interview. Smead owns shares in Wells Fargo, Bank of America and JPMorgan.

On Friday, Stein said the Fed's more clear discussion of the data it will consider in policy changes still give the central bank ample flexibility. Even if unemployment falls below 7%, Stein said weak inflation could give the Fed an ability to maintain its easing program if it believes the economy has not recovered.

Policy flexibility also extend's to the Fed's role in curbing financial system asset bubbles. Financial stability is part of the Fed's "dual mandate" of fostering acceptable unemployment and inflation, Stein said on Friday.

-- Written by Antoine Gara in New York.

If you liked this article you might like

How to Get Rich Using Warren Buffett's Favorite Stock Market Indicators

How to Live Just Like Billionaire Warren Buffett

Why Hurricanes Won't Force the Fed to Ditch a December Rate Hike

How to Make a Deal Like Billionaire Investor Warren Buffett

How to Invest Like Billionaire Warren Buffett