February 5, 2019 / 9:30 PM / 5 months ago

Fed gives banks more stress test information, unveils 2019 scenarios

WASHINGTON, Feb 5 (Reuters) - The Federal Reserve moved on Tuesday to make its stress testing of large banks more transparent, providing financial firms significantly more information about how their portfolios would perform under potential economic shocks.

During the 2019 round of stress tests and going forward, big banks will know “significantly more” information about the models the U.S. central bank uses to test banks’ books, including how hypothetical loans perform under the tests and more detailed information about the Fed’s models.

The 2019 tests will include factoring in a jump to 10 percent unemployment from the current 4 percent rate, as well as elevated stress in corporate loan and commercial real estate markets in the most severe scenario. (Reporting by Pete Schroeder Editing by Paul Simao)

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