(a) In general.
(1) A state member bank must conduct a
stress test as required under this subpart.
(2) Frequency.
(i) General. Except as provided in paragraph (a)(2)(ii) of this section, a state
member bank must conduct a stress test according to the frequency
in table 1 to section 252.14(a)(2)(i).
Table 1 to section 252.14(a)(2)(i)
Table 1 to section
252.14(a)(2)(i)
| If the state member
bank is a |
Then the stress test must be conducted |
| Subsidiary
of a global systemically important BHC |
Annually, by April 5 of
each calendar year, based on data as of December 31 of the preceding
calendar year, unless the time or the as-of date is extended by the
Board in writing. |
| Subsidiary
of a Category II bank holding company |
Annually, by April 5 of
each calendar year, based on data as of December 31 of the preceding
calendar year, unless the time or the as-of date is extended by the
Board in writing. |
| Subsidiary
of a Category II U.S. intermediate holding company |
Annually, by April 5 of
each calendar year, based on data as of December 31 of the preceding
calendar year, unless the time or the as-of date is extended by the
Board in writing. |
Not a subsidiary of a:
(A)
Global systemically important BHC;
(B) Category II bank
holding company; or
(C) Category II U.S. intermediate
holding company |
Biennially,
by April 5 of each calendar year ending in an even number, based on
data as of December 31 of the preceding calendar year, unless the
time or the as-of date is extended by the Board in writing. |
(ii) Change in frequency. The Board may require
a state member bank to conduct a stress test on a more or less frequent
basis than would be required under paragraph (a)(2)(i) of this section
based on the company’s financial condition, size, complexity, risk
profile, scope of operations, or activities, or risks to the U.S.
economy.
(3) Notice and response.
(i) Notification of change in frequency. If
the Board requires a state member bank to change the frequency of
the stress test under paragraph (a)(2)(ii) of this section, the Board
will notify the state member bank in writing and provide a discussion
of the basis for its determination.
(ii) Request
for reconsideration and Board response. Within 14 calendar days
of receipt of a notification under paragraph (a)(3)(i) of this section,
a state member bank may request in writing that the Board reconsider
the requirement to conduct a stress test on a more or less frequent
basis than would be required under paragraph (a)(2)(i) of this section.
A state member bank’s request for reconsideration must include an
explanation as to why the request for reconsideration should be granted.
The Board will respond in writing within 14 calendar days of receipt
of the company’s request.
(b) Scenarios provided by the Board.
(1) In general. In conducting a stress test under this section,
a state member bank must, at a minimum, use the scenarios provided
by the Board. Except as provided in paragraphs (b)(2) and (3) of this
section, the Board will provide a description of the scenarios no
later than February 15 of each calendar year.
(2) Additional
components.
(i) The Board may require a state member
bank with significant trading activity, as determined by the Board
and specified in the Capital Assessments and Stress Testing report
(FR Y-14), to include a trading and counterparty component in its
severely adverse scenario in the stress test required by this section.
The Board may also require a state member bank that is subject to
12 CFR part 217, subpart F or that is a subsidiary of a bank holding
company that is subject to section section 252.54(b)(2)(i) to include
a trading and counterparty component in the state member bank’s severely
adverse scenario in the stress test required by this section. The
data used in this component must be as of a date between October 1
of the previous calendar year and March 1 of the calendar year in
which the stress test is performed, and the Board will communicate
the as-of date and a description of the component to the company no
later than March 1 of that calendar year.
(ii) The Board may require a state member
bank to include one or more additional components in its severely
adverse scenario in the stress test required by this section based
on the state member bank’s financial condition, size, complexity,
risk profile, scope of operations, or activities, or risks to the
U.S. economy.
(3) Additional
scenarios. The Board may require a state member bank to include
one or more additional scenarios in the stress test required by this
section based on the state member bank’s financial condition, size,
complexity, risk profile, scope of operations, or activities, or risks
to the U.S. economy.
(4) Notice and response.
(i) Notification of additional component or scenario. If the Board requires a state member bank to include one or more
additional components in its severely adverse scenario under paragraph
(b)(2) of this section or to use one or more additional scenarios
under paragraph (b)(3) of this section, the Board will notify the
company in writing by December 31 and include a discussion of the
basis for its determination.
(ii) Request
for reconsideration and Board response. Within 14 calendar days
of receipt of a notification under paragraph (b)(4)(i) of this section,
the state member bank may request in writing that the Board reconsider
the requirement that the company include the additional component(s)
or additional scenario(s), including an explanation as to why the
request for reconsideration should be granted. The Board will respond
in writing within 14 calendar days of receipt of the company’s request.
(iii) Description of component. The Board will
provide the state member bank with a description of any additional
component(s) or additional scenario(s) by March 1.
