Stress Test Requirements Clarified for Medium-Sized Entities
The Federal Reserve, Federal Deposit Insurance Corporation (FDIC) and the Comptroller of the Currency (OCC) recently announced clarifications to the stress test requirements for medium-sized financial institutions. Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), financial institutions with assets between $10 billion and $50 billion are allowed to conduct their own internal stress tests, as opposed to the regulator-administered stress tests for larger entities.
The announcement clarifies that those medium-sized financial institutions will still be required to disclose the results of their internal stress tests. Nearly 50 financial institutions will be affected by the new requirement.