Fed to limit use of qualitative stress tests this year
The move enables some large banks to avoid capital planning capabilities examination
The Federal Reserve will limit the use of qualitative tests in the 2019 stress test cycle, it announced on March 6, citing improved capital planning by the largest banks.
Under this amendment, some banks will avoid inspections of their capital planning capabilities. They will still be subject to quantitative tests on their capital adequacy under stressful scenarios.
The qualitative assessments focus on six areas, namely governance, risk management, internal controls, capital policies
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