Fed Governor Michelle Bowman Says Reform Plan Will Improve Bank Stress Test Transparency

Fed Governor Michelle Bowman said the Federal Reserve will complete a reform plan in the next few weeks to improve the transparency and accountability of bank stress tests. According to Odaily, the changes are intended to make stress tests more reliable and reduce volatility in banks' capital requirements. Bowman also said Fed supervisors failed to act in time and decisively enough to require Silicon Valley Bank to reduce its risk exposure. The Federal Reserve will use the average of a bank's two most recent stress test results when determining its stress capital buffer.