Briefings

Week InReview: March 11, 2016

Dodd-Frank mandated the Fed conduct annual stress tests, which produce a set of challenging, hypothetical conditions each year. The Fed then speculates on how the largest banks would cope, and whether banks have enough capital to pay dividends and buy back shares. This week, after its review of a market that created some of the biggest concerns during the 2008 financial crisis, Treasury's Office of Financial Research (OFR) published a working paper which shows that, years after the 2008 financial crisis, trading risk in the industry is still highly concentrated among a small number of firms. OFR researchers also noted that the banks have migrated from being net sellers of credit default swap protection to net buyers.

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