Key points from the Fed’s 2019 DFAST and CCAR

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On June 27, the Federal Reserve released the results of its Comprehensive Capital Analysis and Review (CCAR) following the June 21 release of its Dodd-Frank Act Stress Test (DFAST). All 18 banks subject to this year’s quantitative evaluation passed cleanly, although two used the Fed’s “mulligan” option and adjusted downward their planned payouts to ensure that they finished above the required thresholds. Only five intermediate holding companies (IHCs) were still subject to qualitative assessments this year and none received a capital plan objection, though one conditionally passed. After several surprises last year, this year’s results will be broadly embraced by the banks as they reflect their substantial capital levels and strong progress toward meeting the Fed’s high bar for capital and risk management.

  1. No capital plan objections and one conditional non-objection
  2. Still supervision, but behind the scenes
  3. Quantitative test got 30% easier
  4. Modest transparency enhancements
  5. What’s next?

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