2022 Federal Reserve Stress Test Results

2022 Federal Reserve Stress Test Results

The Federal Reserve System is the central bank of the United States. It performs five key functions to promote the effective operation
of the U.S. economy and, more generally, the public interest.
The Federal Reserve

  1. Conducts the nation’s monetary policy to promote maximum employment and stable prices in the U.S. economy;
  2. Promotes the stability of the financial system and seeks to minimize and contain systemic risks through active monitoring and engagement in
    the U.S. and abroad;
  3. Promotes the safety and soundness of individual financial institutions and monitors their impact on the financial system as a whole;
  4. Fosters payment and settlement system safety and efficiency through services to the banking industry and U.S. government that facilitates
    U.S.-dollar transactions and payments; and
  5. Promotes consumer protection and community development through consumer-focused supervision and examination, research and analysis of emerging consumer issues and trends, community economic development activities, and administration of consumer laws and regulations.

The Federal Reserve Stress Testing 

The Federal Reserve promotes a safe, sound, and efficient banking system that supports the U.S. economy through its supervision and regulation of domestic and foreign banks. The Federal Reserve annually conducts a supervisory stress test as part of its supervision efforts.
The stress test assesses how large banks are likely to perform under a hypothetical recession.

Each year, the Federal Reserve publishes four documents, in the following chronological order:

  • Stress Test Scenarios describe the hypothetical recessions used in the supervisory stress test. The Stress Test Scenarios document is typically published by mid-February.
  • Supervisory Stress Test Methodology details the models and methodologies used in the supervisory stress test. The Supervisory Stress Test Methodology document is typically published at the end of the first quarter.
  • Federal Reserve Stress Test Results report the aggregate and individual bank results of the supervisory stress test, which assesses whether banks are sufficiently capitalized to absorb losses during a severe recession. The Federal Reserve Stress Test Results document is typically published at the end of the second quarter.
  • Large Bank Capital Requirements announces the individual capital requirements for all large banks, which are partially determined by the supervisory stress test results. The Large Bank Capital Requirements document is typically published during the third quarter.

These publications can be found on the Stress Test Publications page (https://www.federalreserve.gov/publications/dodd-frank-act-stress-test-publications.htm).

To find the results of this year’s stress test, click here