Federal Reserve Maintains Capital Requirements for Large Banks Until 2027

The Federal Reserve has decided to maintain the current capital requirements for large banks through the 2026 stress test cycle, delaying any changes until 2027. According to NS3.AI, Vice Chair Michael Bowman stated that this postponement will allow the Fed additional time to examine potential issues within its stress test models, particularly those related to recession scenario simulations. Additionally, the Fed has pledged to enhance transparency by allowing public comment on its stress testing models and by annually disclosing the stress scenarios.