Stress test results show Fed toughening up

Median post-stress ratio of 7.9% the lowest pass mark to date

The Federal Reserve made good on its promise to make this year’s stress tests the toughest yet, as Risk Quantum analysis shows that the median post-stress ratio was the lowest in five years. 

Under the severely adverse scenario, the median bank reported a post-stress minimum Common Equity Tier 1 (CET1) ratio of 7.9%, 20 basis points lower than in 2017 and the lowest across the last five years of stress tests for which public data is available. 

To pass the tests, a firm must report a post