From Beach Hotels to Bank Capital: Rethinking Risk Through Stress Testing

Event Q&A

Stress Testing Isn't Just a Fed Requirement - It's a Survival Strategy

A banking executive explores how stress testing reveals vulnerabilities in capital and operations, highlighting its value as both a regulatory tool and a strategic compass in an unpredictable economic environment.

Jul 17, 2025

Sergey Yeremenko, Internal Audit Director, Capital Markets and Market Risk, PNC

Tags: Stress Testing

Stress Testing Isn't Just a Fed Requirement - It's a Survival Strategy

The views and opinions expressed in this content are those of the thought leader as an individual and are not attributed to CeFPro or any other organization

Stress testing must move beyond regulatory compliance to strategic risk insight
Internal scenarios should reflect unique exposures, not just Fed-designed shocks
Rising interest rates have triggered unrealized losses without credit deterioration
Portfolio restructuring decisions materially affect capital resilience
Operational risk modeling remains complex but increasingly essential
Regulators expect rigorous stress testing even for mid-sized banks
Future capital requirements may increase for operational risk
Scenario flexibility and internal governance are key to supervisory confidence
Line-of-business indicators must complement enterprise stress testing
Stress testing is a vital strategic capability, not just a reporting exercise

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