Banks tout CCAR-style stress tests for emergent risks

Extreme-but-plausible scenario planning is being applied to geopolitical events such as the Ukraine conflict

War in Europe, a global pandemic, ‘one-in-a-million’ weather disasters: the occurrence of events that were once assigned a near-zero probability has prompted bank risk managers to incorporate extreme scenarios into their internal stress tests. Major US banks are already subject to the CCAR capital planning regime, which tests firms against a range of scenarios. Financial institutions also run internal risk management exercises, known as risk and control self-assessment, Read more:

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