Federal Reserve Board finalizes changes to enhance the transparency and public accountability of its stress test and reduce volatility in its stress test-related capital requirements

The Federal Reserve Board on Wednesday finalized changes to enhance the transparency and public accountability of its stress test and reduce volatility in its stress test-related capital requirements. The two final rules are largely similar to the proposed rules from 2025. The Board also requested comment on a proposal to better capture differences in banks' business models to generate fee income. The Board conducts stress tests to ensure that large banks are sufficiently capitalized and able to lend to households and businesses even in a severe recession. In December 2024, the Board announced it would modify the test to improve its resilience.