Fed presents two severe stress scenarios to test Covid risks
Limits on share buybacks and dividend payouts may be extended as stress tests emphasise risks
The Federal Reserve has unveiled its second round of stress-testing in 2020, departing from previous exercises by imposing two different “severe” scenarios.
The Fed also says it is considering whether to extend its emergency restrictions on share buybacks and dividend payouts, which it announced earlier this year.
It published its 2020 stress-testing results in June. Despite concluding that all major banks were adequately capitalised, the Fed opted then to limit banks’ dividend payouts, given
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