§ 1238.1 - Authority and purpose.

§ 1238.1 Authority and purpose.

(a) Authority. This part is issued by the Federal Housing Finance Agency (FHFA) under section 165(i) of Title I of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) (Pub. L. , Public Law 111-203, 124 Stat. 1376, 1423-32 (2010), 12 U.S.C. 5365(i)), the Safety and Soundness Act, as amended (as amended by section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA), Public Law 115-174, 132 Stat. 1296 (2018), 12 U.S.C. 4513, 4526, 4612), and the Bank 5365(i); and the Safety and Soundness Act (12 U.S.C. 14264513, 4526, 4612).

(b) Purpose.

(1) This part implements section 165(i)(2) of the Dodd-Frank Act, as amended by section 401 of the EGRRCPA, which requires all large financial companies that have total consolidated assets of more than $10 $250 billion, and are regulated by a primary federal financial regulatory agency, to conduct annual periodic stress tests. To ensure the safety and soundness of the regulated entities, the Director reserves and retains the discretion to apply this part to any regulated entity with less than $10 billion total consolidated assets in a particular year.

(2) This part establishes requirements that apply to each regulated entityEnterprise's performance of annual periodic stress tests. The purpose of the annual periodic stress test is to provide the regulated entitiesEnterprises, FHFA, and the FRB with additional, forward-looking information that will help them to assess capital adequacy at the regulated entities Enterprises under various scenarios; to review the regulated entitiesEnterprises' stress test results; and to increase public disclosure of the regulated entitiesEnterprises' capital condition by requiring broad dissemination of the stress test scenarios and results.

[78 85 FR 5922216529, SeptMar. 26, 2013, as amended at 81 FR 76295, Nov. 2, 201624, 2020]