Modification of stress testing requirements proposed

The Federal Reserve Board is inviting comments on a proposal that would modify company-run stress testing requirements to conform with the Economic Growth, Regulatory Relief, and Consumer Protection Act. The proposal would raise the threshold requiring state-member banks to conduct their company-run stress tests from $10 billion in total consolidated assets to $250 billion. Additionally, in place of the current annual cycle, the proposal would generally require firms above the threshold to conduct company-run stress tests once every other year. It would also eliminate the hypothetical "adverse" scenario from company-run stress tests for bank holding companies, state member banks, U.S. intermediate holding companies of foreign banking organizations, and any nonbank financial company supervised by the Board. Similarly, the Board would no longer include an "adverse" scenario in its supervisory stress tests. Comments will be accepted until February 19, 2019.