A review of the discussion proposal on changes to the EU-wide stress test

In 2020, the European Banking Authority (EBA) launched a public consultation on future changes to the European Union wide stress test (EUWST). The EBA proposes a dual approach across four broad criteria of relevance, comparability, transparency, and cost efficiency: a supervisory leg as the basis fo...

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Bibliographic Details
Published in:Central Bank review 2024-09, Vol.24 (3), p.100161, Article 100161
Main Authors: Llorent-Jurado, Julián, Ordaz-Sanz, José Antonio, Melgar-Hiraldo, María del Carmen, Guerrero-Casas, Flor María
Format: Article
Language:English
Subjects:
B40
Bank leg
European banking authority
G01
G38
N24
Pillar 2
Stress test
Supervisory leg
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Summary:In 2020, the European Banking Authority (EBA) launched a public consultation on future changes to the European Union wide stress test (EUWST). The EBA proposes a dual approach across four broad criteria of relevance, comparability, transparency, and cost efficiency: a supervisory leg as the basis for Pillar 2 Guidance decisions and a bank leg to provide information and foster market discipline. Prior to new methodological proposals, an accurate global and summarized overview of what has been accomplished so far is required. This paper presents a synthetic review of the EBA's vision for the EUWST's future and feedback review.
ISSN:1303-0701
DOI:10.1016/j.cbrev.2024.100161