The new Dodd-Frank Act supervisory stress test requirements are generally consistent with the stress tests that the Federal Reserve has been conducting on the largest U.S. bank holding companies since the Supervisory Capital Assessment Program in the spring of 2009.
The stress tests allow supervisors to assess whether firms have enough capital to weather a severe economic downturn and contribute to the Federal Reserve’s ability to make assessments of the resilience of the U.S. banking system under adverse economic scenarios.