Breaking Down the Bank Stress Tests

On Thursday, June 25th, the Federal Reserve released the results of its annual bank stress testing exercise. Due to the ongoing pandemic and the economic recession it has caused, there was added attention on this year’s results.

In this episode, Greg Gelzinis explains what the stress tests do and do not reveal, and what risks remain to the banking sector. Gregg is a senior policy analyst for Economic Policy at the Center American Progress, where he focuses on financial institutions, financial markets, and consumer finance policy.

Resources:

Bank Capital and the Coronavirus Crisis 4 Ways the Federal Reserve Can Improve the Resilience of the Banking System

https://cdn.americanprogress.org/content/uploads/2020/05/07111724/Banking-Capital.pdf

Are we seeing the demise of stress testing

From

Federal Reserve Board releases results of stress tests for 2020 and additional sensitivity analyses conducted in light of the coronavirus event

https://www.federalreserve.gov/newsevents/pressreleases/bcreg20200625c.htm

Want to contact the show? Reach out at reiners@law.duke.edu

Interested in learning more about issues in financial regulation and policy? Check out the Global Financial Markets Center’s blog, The FinReg Blog.