Press Release

September 04, 2020 Federal Reserve Board releases corrected stress test results stemming from an error in projected trading losses and as a result, revised the capital requirements for two banks For release at 11:00 a.m. EDT Share The Federal Reserve Board on Friday released corrected stress test results stemming from an error in projected trading losses and as a result, revised the capital requirements for two banks. The Board identified the error and all results affected by it, corrected those results, and implemented changes to prevent similar errors in the future. The loss rates for certain public welfare investments made by large banks were initially miscalculated, resulting in an overestimation of hypothetical losses for those investments. The error affected five banks: Citigroup Inc., The Goldman Sachs Group Inc., HSBC North America Holdings Inc., Morgan Stanley, and Wells Fargo & Company. The resulting common equity tier 1, or CET1, capital requirements for three firms were unaffected, while the CET1 capital requirements for two firms were revised. The updated CET1 requirements for the five firms are listed in the table below. The related stress test results documents have also been updated. In its review of the loss models used for certain public welfare investments, the Board identified other model components that were similarly implemented and has conducted additional reviews, which found no further implementation errors. For media inquiries, call 202-452-2955 Dodd-Frank Act Stress Test 2020: Supervisory Stress Test Results (PDF) Assessment of Bank Capital during the Recent Coronavirus Event (PDF) Dodd-Frank Act Stress Test Results, 2013-2020 (CSV)

Federal Reserve (2020, September 3). Press Release. Press Releases, Federal Reserve. https://whenthefedspeaks.com/doc/press_release_20200904_federal_reserve_board_releases_corrected_stress

@misc{wtfs_press_release_20200904_federal_reserve_board_releases_corrected_stress,
  author = {Federal Reserve},
  title = {Press Release},
  year = {2020},
  month = {Sep},
  howpublished = {Press Releases, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/press_release_20200904_federal_reserve_board_releases_corrected_stress},
  note = {Retrieved via When the Fed Speaks corpus}
}