Fed: New Stress Test Results Out March 5

Industries FOXBusiness

The Federal Reserve on Thursday announced that the results of the latest round of bank stress tests will be released on March 5 at 4:30 p.m.

Continue Reading Below

The results of analysis on big banks’ capital will be released March 11.

Both data releases are part of requirements mandated under the Dodd-Frank banking reform legislation passed in the wake of the 2008 financial crisis.

According to a statement released by the Fed, the Dodd-Frank stress tests are “forward looking exercises conducted by both Federal Reserve supervisors and by large bank holding companies supervised by the Federal Reserve.”

The tests are conducted on banks such as J.P. Morgan Chase (JPM), Citigroup (C) and Bank of America (BAC) with assets of more than $50 billion.

The stress tests and capital analysis are used to determine whether a bank is capable of withstanding another economic downturn similar to the 2008 crisis that required a massive government bailout.

Continue Reading Below

When credit markets seized in 2008 it quickly became clear that many large banks had no programs in place to handle the crisis and not enough assets on hand to pay their short-term debts.

 

What do you think?

Click the button below to comment on this article.