WASHINGTON Feb 3 The Federal Reserve on Friday
asked the largest U.S. banks to measure how they would fare in a
global recession with a high jobless rate as the central bank
outlined the terms for its 'stress test' of the largest U.S.
If banks do not prove that they can weather such a downturn,
the Fed may freeze payouts to investors while the lenders boost
The largest 13 lenders must report their results to the Fed
by April 5 with results announced by the end of June, the
central bank said in a statement.
Another 21 large lenders must also answer to the Fed but on
a narrower set of questions. Last year, the central bank said
those smaller lenders would be exempted from tests of internal
controls and planning.
The 'stress tests' were conceived in the 2010 Dodd Frank
reform legislation meant to prevent a future financial meltdown
like the one that followed the 2008 housing market collapse.
(Reporting By Patrick Rucker; Editing by Chizu Nomiyama)