Federal Reserve Announces Dates for Release of Stress Test and CCAR Results

Katten Muchin Rosenman LLP
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The Federal Reserve Board on January 28 announced that results from the supervisory stress tests conducted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act will be released on Thursday, March 7, and the related results from the Comprehensive Capital Analysis and Review (CCAR) will be released on Thursday, March 14. Results will be released for both exercises at 4:30 p.m. Eastern Time.

The Dodd-Frank Act stress tests

are forward-looking exercises conducted by the Federal Reserve and large financial companies supervised by the Federal Reserve to help assess whether institutions have sufficient capital to absorb losses and support operations during adverse economic conditions. The Dodd-Frank Act supervisory stress test results will include data such as capital ratios, revenue, and loss estimates under a severely adverse scenario and assuming a common set of capital actions that is used in the analysis of all of the firms.

CCAR is an annual exercise by the Federal Reserve

to help assess whether the largest bank holding companies have sufficient capital to continue operations during the upcoming two-year period assuming economic and financial stress and have robust, forward-looking capital planning processes that account for their unique risks and are supported by the firms' risk-measurement and -management practices. As part of the CCAR, the Federal Reserve evaluates each company's plans to make capital distributions, such as dividend payments, stock repurchases, or planned acquisitions.

A list of companies being reviewed is available here.

 

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