The Federal Reserve promotes a safe, sound, and efficient banking system that supports the U.S. economy through its supervision and regulation of domestic and foreign banks.
As part of its supervision efforts, the Federal Reserve conducts annually a supervisory stress test. The stress test assesses how large bank holding companies are likely to perform under a hypothetical recession.1
Each year, the Federal Reserve publishes four documents, in the following chronological order:
- Stress Test Scenarios describes the hypothetical recessions used in the supervisory stress test. The Stress Test Scenarios document is typically published by mid-February.
- Supervisory Stress Test Methodology provides details about the models and methodologies used in the supervisory stress test. The Supervisory Stress Test Methodology document is typically published at the end of the first quarter.
- Supervisory Stress Test Results reports the aggregate and individual bank results of the supervisory stress test, which assesses whether banks are sufficiently capitalized to absorb losses during a severe recession. The Supervisory Stress Test Results document is typically published at the end of the second quarter.
- Large Bank Capital Requirements announces the individual capital requirement for all large banks, which are partially determined by the results of the supervisory stress test. The Large Bank Capital Requirements document is typically published during the third quarter.
These publications can be found on the Stress Test Publications page (https://www.federalreserve.gov/publications/dodd-frank-act-stress-test-publications.htm).
For information on the Federal Reserve's supervision of large financial institutions, see https://www.federalreserve.gov/supervisionreg/large-financial-institutions.htm. For information on the Federal Reserve's supervision of capital-planning processes of firms, see https://www.federalreserve.gov/supervisionreg/stress-tests-capital-planning.htm.
For more information on how the Board promotes the safety and soundness of the banking system, see https://www.federalreserve.gov/supervisionreg.htm.
1. U.S. bank holding companies (BHCs), savings and loan holding companies (SLHCs), and intermediate holding companies of foreign banking organizations (IHCs) with $100 billion or more in assets are subject to the Board's supervisory stress test rule (12 C.F.R. 238 pt. 238, subpart O; 12 C.F.R. pt. 252, subpart E) and capital planning requirements (12 C.F.R. ยง 225.8; 12 C.F.R. pt. 238, subpart S). Return to text