Stress test projected loan losses fall $18bn
Credit card loss rates account for 36.3% of total loan losses under severely adverse scenario
The 18 banks that participated in the Federal Reserve’s latest stress tests would incur aggregated loan losses of $295.4 billion under the severely adverse scenario, $18.1 billion less than last year.
The results of the Fed’s Dodd-Frank Act Stress Test 2019 show lower projected loan losses in the event of a severe recession in all but two business segments, compared with 2018: credit cards and other consumer loans, which include student loans and automobile loans.
Compared with last year’s
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