JPMorgan, Citigroup, And Others Sue Federal Reserve Over Stress Tests

JPMorgan, Citigroup, Goldman Sachs, and other big banks, along with business groups like the American Bankers Association and the U.S. Chamber of Commerce, are suing the Federal Reserve over its annual stress tests.

The lawsuit, filed by the Bank Policy Institute, aims to address legal violations by requiring public input in the stress test process, as mandated by federal law. While the groups support stress testing, they argue the current process imposes inconsistent and unexplained restrictions on bank capital. In response, the Fed announced plans to review and seek public comment on changes to improve transparency and reduce volatility in capital buffer requirements. However, the proposed adjustments may not fully satisfy the banks’ concerns over capital rules.