Featured Product

    FED Publishes Results of the 2019 CCAR Exercise for Banks

    June 27, 2019

    FED published results of the Comprehensive Capital Analysis and Review, or CCAR, for 2019. This year's CCAR reveals that the largest banks have strong capital levels and virtually all are meeting the supervisory expectations for capital planning. Consequently, FED is not objecting to the capital plans of all 18 firms, though it is requiring Credit Suisse to address certain limited weaknesses in its capital planning processes by October 27, 2019.

    The firms in the test have significantly increased their capital since the first round of stress tests in 2009. In particular, the largest and most complex banks have more than doubled their common equity capital from about USD 300 billion to roughly USD 800 billion during that time. "The results show that these firms and our financial system are resilient in normal times and under stress," said Vice Chair for Supervision Randal K. Quarles. However, FED observes that, on balance, most of the firms participating in the CCAR 2019 qualitative assessment have continued to strengthen their capital planning practices since last year, with many of those firms meeting supervisory expectations for capital planning. Certain firms that are newer to CCAR have additional work to undertake to have sound, established capital planning practices and a limited number of firms that have been subject to the qualitative assessment for a number of years have certain weaknesses that limit their capital planning capabilities. 

    The Comprehensive Capital Analysis and Review, or CCAR, evaluated the capital planning processes and capital adequacy of 18 of the largest banking firms, including the firms' planned capital actions, such as dividend payments and share buybacks. FED considers both quantitative and qualitative factors when evaluating a bank's capital plan. Quantitative factors include a bank's projected capital ratio under a hypothetical severe recession. Qualitative factors include the firm's capital planning process, including its risk management, internal controls, and governance practices. FED can object to the capital plans of all banks in CCAR each year on quantitative grounds and firms that have been in CCAR for less than four years are also subject to an objection on qualitative grounds. If FED objects to a firm's capital plan, the bank cannot make any capital action unless authorized by FED. The CCAR quantitative assessment uses the same results as Dodd-Frank Act Stress Test (DFAST) and incorporates firms’ planned capital actions, such as dividend payments and common stock repurchases.

     

    Related Links

    Keywords: Americas, US, Banking, Stress Testing, CCAR, DFAST, Credit Suisse, Capital Planning, Dodd-Frank Act, Basel III, FED

    Featured Experts
    Related Articles
    News

    HKMA Finalizes Policy Modules on Group-Wide Approach and Remuneration

    The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.

    July 29, 2021 WebPage Regulatory News
    News

    EBA Guide to Monitor Threshold for Intermediate Parent Undertakings

    The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).

    July 28, 2021 WebPage Regulatory News
    News

    PRA Finalizes Approach to Supervision of International Banks

    In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.

    July 26, 2021 WebPage Regulatory News
    News

    FCA Issues PS21/9 on Implementation of Investment Firms Regime

    The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.

    July 26, 2021 WebPage Regulatory News
    News

    EBA Proposes Regulatory Standards to Identify Shadow Banking Entities

    The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.

    July 26, 2021 WebPage Regulatory News
    News

    IOSCO Proposes Recommendations on ESG Ratings and Data Providers

    The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.

    July 26, 2021 WebPage Regulatory News
    News

    ESMA Group Issues Recommendations on RFR Switch in Interdealer Market

    The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.

    July 26, 2021 WebPage Regulatory News
    News

    ECB Study Assesses Impact of Basel III Finalization Package

    The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.

    July 26, 2021 WebPage Regulatory News
    News

    ISDA Finds FRTB Results in Higher Capital Charges for Carbon Trading

    The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.

    July 26, 2021 WebPage Regulatory News
    News

    PRA Updates Remuneration Policy Statement Templates and Tables

    The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.

    July 26, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7307