Federal Reserve Unveils Wall Street Bank Stress-Test Plans


The tests were put in place after the 2008 financial crisis to ensure the US banking system could withstand the next crisis and are aimed help ensure that large banks are able to lend to households and businesses, even in a severe recession. They also evaluate estimating bank losses, revenues, expenses, and resulting capital levels—which provide a cushion against losses—under hypothetical recession scenarios into the future.


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