Banks Face Growing Capital Scrutiny With Stress Tests Up First
- Results will be followed by Basel III Endgame requirements
- Past years’ dividend, buybacks announcements aren’t expected
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The Federal Reserve’s stress test is usually the most dreaded part of Wall Street firms’ annual capital planning. This year, it’s just the first hurdle to clear as regulators explore more stringent requirements on banks in the aftermath of several lender collapses.
The test results, set to be released Wednesday afternoon, mark the beginning of a trio of regulatory actions that will impact how much capital banks are required to hold on their balance sheets. The two that follow are likely to be far more burdensome.