The Federal Reserve Announces Reform Plan for Stress Testing of Large U.S. Banks, Plans to Delay Effective Date of Capital Buffer Requirements

The Federal Reserve is refining its reform plan for stress testing of large banks and has submitted a proposal to solicit public comments. The proposal will calculate an average result over two years. The Federal Reserve states it intends to postpone the effective date of the annual stress capital buffer requirement from October 1st to January 1st of the following year, giving banks more time to adapt to the new capital requirements. The proposal will also "make targeted changes to simplify the data collection process related to Board stress tests." The Federal Reserve states that these planned reforms are not aimed at having a material impact on capital requirements.