Banks Need More Imagination In Stress Tests, Report Says

Law360, New York (April 13, 2012, 1:35 PM EDT) -- A key international banking regulator on Friday said that banks should incorporate more comprehensive and flexible stress tests in their capital assessment programs, finding that they had a "failure of imagination" when it came to potential financial calamities.

The Basel Committee on Bank Supervision said in a report that banks had increasingly turned to stress tests as a way to determine whether they could whether a severe economic shock following the 2008 financial crisis, but that many of those banks were not incorporating harsh enough scenarios...
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