Federal Reserve Board Launches 2013 Capital Planning and Stress Testing Program

The Federal Reserve Board launched the 2013 capital planning and stress testing program, issuing instructions to firms with timelines for submissions and guidelines. The goal is to ensure that large, complex banking institutions have robust, forward-looking capital planning processes that account for their unique risks, and to that end, such institutions have sufficient capital to continue operations throughout times of economic and financial stress. The program includes the Comprehensive Capital Analysis and Review (CCAR) of 19 firms as well as the Capital Plan Review (CapPR) of an additional 11 bank holding companies with $50 billion or more of total consolidated assets.

Firms' capital adequacy will be assessed against a number of quantitative and qualitative criteria, including project performance under the stress scenarios provided by the Federal Reserve and the institutions' internal scenarios. Board of directors of the institutions are required to review and approve capital plans before submitting them to the Federal Reserve.

Institutions will be required to submit their capital plans no later than January 7, 2013.

Click here to view notice in full (links externally to FRB website).See also: Comprehensive Capital Analysis and Review 2013 Summary Instructions and Guidance (PDF); Capital Plan Review 2013 Summary Instructions and Guidance (PDF).