After June 30, 2021, banks with capital levels above the minimum risk-based requirements under the current round of stress tests will no longer be subject to the temporary and additional restrictions on bank dividends and share repurchases. The Federal Reserve Board stated that banks with capital levels below the minimum risk-based requirements will remain subject to the additional restrictions on bank dividends and share repurchases through September 30, 2021.
Although the FRB found during the 2020 stress tests that large banks had strong capital levels, the FRB decided, in light of the risk created by the COVID-19 pandemic, to impose additional capital distribution restrictions on top of the typical stress capital buffer framework.
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