Washington, D.C. – BPI President and CEO Greg Baer responded today to the Federal Reserve’s proposal to average stress test results. The release includes only the averaging of stress test results — beginning with the 2025 stress testing cycle — a delay of the annual effective date of the stress capital buffer to give more time for banks to adjust to the new requirement and an expansion of the data collection to improve the modeling of bank net revenues.
“Today’s proposal to suppress spurious volatility in stress capital charges through averaging is one part of the Federal Reserve’s promised reforms to its stress testing framework. In its release, the Federal Reserve commits to disclosure of the models that calculate capital depletion under the stress test as well as the scenarios that form the basis of the test. We look forward to those steps, which are required to meet the requirements of the Administrative Procedure Act.”
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The Bank Policy Institute is a nonpartisan public policy, research and advocacy group that represents universal banks, regional banks and the major foreign banks doing business in the United States. The Institute produces academic research and analysis on regulatory and monetary policy topics, analyzes and comments on proposed regulations, and represents the financial services industry with respect to cybersecurity, fraud, and other information security issues.
Media Contacts
- Austin Anton, Bank Policy Institute, austin.anton@bpi.com
