Since we have just completed a second annual exercise using both supervisory tools, I thought this risk conference would be a good occasion for reviewing the rationale and features of these tools, describing the recent results, and identifying some issues we will be considering as we continue to develop these tools in the future.
Tools for dynamic capital supervision The potential utility of comprehensive stress testing had been much discussed among academics, analysts, and regulators in the years preceding the financial crisis, but it was only during the crisis that this tool was used across large firms at the same time.