Regulatory Alerts2026-02-04
Federal Reserve Board finalizes hypothetical scenarios for its annual stress test and maintains capital requirements until public feedback is considered
The Federal Reserve Board finalized the hypothetical scenarios for its 2026 annual supervisory stress test and voted to maintain current capital buffer requirements until 2027. Thirty-two large banks will be evaluated against a severe global recession featuring a peak unemployment rate of 10 percent, significant declines in residential and commercial real estate prices, and heightened corporate debt market stress. The Board will defer calculating new stress capital buffer requirements until public feedback is incorporated into supervisory models, ensuring greater transparency and model accuracy for banks with substantial trading or custodial operations.
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