Oct 9 (Reuters) - U.S. bank regulators are set to vote on a plan requiring banks with more than $10 billion in assets to conduct annual stress tests to determine if they can withstand a financial shock.
The board of the Federal Deposit Insurance Corp will vote Tuesday on the plan, which was modified from an earlier proposal to give smaller banks more time before they must begin testing, according to FDIC staff.
Stress tests are intended to demonstrate how banks would cope with a crisis and are part of a more rigorous testing regime mandated by the 2010 Dodd-Frank financial oversight law. The largest U.S. banks face several such regulatory tests.
Under the plan, FDIC-regulated banks with more than $10 billion in assets would run the tests each year according to stress scenarios provided by regulators. The results will help regulators gauge the health of the banking industry and identify steps banks must take to strengthen their operations.
Banks with between $10 and $50 billion in assets will have until 2013 before they must begin stress testing, and they will have an additional year after that before they must publicly disclose the results of annual tests, the FDIC said.
Larger banks will begin testing this year, the FDIC said.
The FDIC initially proposed its rules in January. The Federal Reserve and the Office of the Comptroller of the Currency are finishing similar rules for the banks they regulate.
(Reporting By Emily Stephenson; editing by John Wallace)
((Emily.Stephenson@thomsonreuters.com)(202 354 5823))
Keywords: FINANCIAL REGULATION/STRESS