FHFA: Stress Testing of Regulated Entities

FHFA: Stress Testing of Regulated Entities

FHFA: Stress Testing of Regulated Entities

Investor Update
March 24, 2020

Source: FHFA

SUMMARY:  The Federal Housing Finance Agency (FHFA) is adopting a final rule that amends its stress testing rule, consistent with section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA).  These amendments adopt the proposed amendments without change to modify the minimum threshold for the regulated entities to conduct stress tests increased from $10 billion to $250 billion; removal of the requirements for Federal Home Loan Banks (Banks) subject to stress testing; and removal of the adverse scenario from the list of required scenarios.  These amendments align FHFA’s rule with rules adopted by other financial institution regulators that implement the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) stress testing requirements, as amended by EGRRCPA.

DATES:  This rule is effective March 24, 2020.