Financial firms with $50 billion or more in assets will launch required, annual Dodd-Frank stress tests this year.
At the same time, banking regulators are giving smaller financial firms with $10-to-$50 billion in assets until October 2013 to develop the framework for and roll out stress tests.
The Office of the Comptroller of the Currency made that statement Tuesday when rolling out its final rule for the part of Dodd-Frank Act dealing with annual stress tests at mega banks.
For financial firms with $50-billion and more in assets, the OCC claims the institutions' size and familiarity with capital testing makes it essential to the survivability of those firms.
Results from those tests will be reported to the OCC in January 2013.
The OCC changed the deadline for smaller institutions after receiving comments from professionals in the financial space who argued more time is needed from smaller banks to create the framework for stress testing.
The industry also sent in numerous comments saying the stress-testing guidelines had the potential to become duplicative and onerous unless the OCC and FDIC managed to work with other prudential regulators to quash any redundancies in the requirements.
The OCC responded to these concerns, saying it "has worked to minimize any potential duplication related to the annual stress test requirements. In particular, the OCC worked closely with the other agencies to make consistent and comparable the rules' standards in the areas of scope of application, scenarios, data collection and reporting forms."
The shared expectations among the agencies are reflected in the FDIC's publication of its own final rule regarding stress testing. The FDIC has the same timeline requirements for banks with $10 to $50 billion assets, while those with $50 billion or more begin testing this year. However, both regulators say they maintain the authority to grant extensions to mega banks in the $50-plus billion category when warranted.
The FDIC said to date there are 108 financial firms with $10 billion or more in assets.