Building upon previously issued supervisory guidance that discusses the uses and merits of stress testing in specific areas of risk management, the guidance provides an overview of how a banking organization should structure its stress testing activities and ensure they fit into overall risk management. The purpose of this guidance is to outline broad principles for a satisfactory stress testing framework and describe the manner in which stress testing should be employed as an integral component of risk management that is applicable at various levels of aggregation within a banking organization, as well as for contributing to capital and liquidity planning. While the guidance is not intended to provide detailed instructions for conducting stress testing for any particular risk or business area, the proposed guidance aims to describe several types of stress testing activities and how they may be most appropriately used by banking organizations.
US Code:
12 USC 1817
Name of Law: Federal Deposit Insurance Act
Building upon previously issued supervisory guidance that discusses the uses and merits of stress testing in specific areas of risk management, the proposed guidance provides an overview of how a banking organization should structure its stress testing activities and ensure they fit into overall risk management. This is a new collection with a new burden.
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(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a benefit, or mandatory);
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