Large U.S. Banking Companies Readily Meet Capital Requirements Following Finalized Stress Capital Buffers

Large U.S. Banking Companies Readily Meet Capital Requirements Following Finalized Stress Capital Buffers
The Federal Reserve Board (FRB) announced the large banks' capital requirements incorporating the now finalized Stress Capital Buffers (SCBs).

-- The FRB's final SCBs, announced on August 25, 2024, are similar to preliminary SCB levels.
-- Banks already met the new requirements with most regionals showing significant buffers over requirements.
-- The SCBs for the global systemically important banks (G-SIBs) buffers are tighter to requirements, which remain higher, reflecting the additional G-SIB buffer and the inclusion of additional other comprehensive income in CET1 calculations.

"Following the stress tests, and with a view toward these expected changes to regulatory capital requirements, many banks have resumed capital management activity, including stock buybacks, albeit at a more measured pace than in previous years," said John Mackerey, Senior Vice President and Sector Lead, North American Financial Institutions Ratings.