The Federal Reserve finalized the hypothetical scenarios for its annual stress test for large banks.
Details: The Fed:
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Said the final scenarios are substantially similar to the scenarios proposed in October.
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Voted to maintain the current stress capital buffer requirements until 2027, when new requirements can be calculated based on models that take public feedback into consideration.
Background: The Fed conducts stress tests to ensure that large banks are sufficiently capitalized even in a severe recession. The agency in December 2024 announced it would modify the test, proposed changes in April 2025, and requested feedback last October.