WASHINGTON, D.C.— Phillip Basil, Director of Economic Growth and Financial Stability, issued the following statement on the filing of a comment letter to the Federal Reserve on the proposed scenarios for the 2026 supervisory stress test:

“The Federal Reserve’s publication of the 2026 supervisory stress test scenarios ultimately undermines the purpose of the stress test. By allowing the very banks that are subject to the stress test to comment on and potentially change the details of the scenarios, the Fed is ensuring that the scenarios will become less stressful and less dynamic. This is already proven by this year’s ‘stress’ scenario, which lacks any true severity or unique factors that capture unseen or under-appreciated risks.

“The proposal of stress test scenarios combined with other changes that have been or are being made to the stress test are destroying its effectiveness as a tool to inform the public on the health of our largest banks and set stress-related capital requirements. The American people deserve a strong stress test that is more than just false comfort they are being protected against future taxpayer bailouts.”

The comment letter is available here.

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