The lawmakers argued in a letter to the Federal Reserve that suspending dividend payouts would be the "prudent course of action," allowing banks to build their capital cushions and continue lending during the coronavirus pandemic.
Big banks will need to show how well they can withstand three different scenarios before they can pay dividends; the German payments company is still looking for $2 billion of missing funds.
The senior official said the Federal Reserve’s gauge of a firm’s performance under economic recovery scenarios will affect decisions about its capital distribution, but individual results of the analysis will not be made public.
The general structure of this year’s reviews is unchanged despite the pandemic. But a supplemental analysis of banks' response to the downturn could weigh heavily in evaluating 2020 capital distributions and making adjustments to the tests over the long run.
At a Senate hearing with all the bank regulators, Joseph Otting got an earful over his agency’s decision to move forward with Community Reinvestment Act reform during the pandemic. Lawmakers also urged the Fed to speed up the rollout of coronavirus relief programs.
The Financial Stability Board said it stood ready to coordinate additional help on capital requirements, upcoming regulatory deadlines and other standards.
The agency's top supervisory official said the Comprehensive Capital Analysis and Review will proceed on schedule, and signaled that the Fed will look at how institutions are responding to fallout from the coronavirus.
Jennifer Piepszak, JPMorgan's chief financial officer, said the largest U.S. bank planned to borrow funds through the Federal Reserve's emergency lending facility in an exercise designed to break the stigma attached to that program.
