Home Prices Expected to See a Slight Decline

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Mortgage rate lock-in will continue to be a major challenge for the housing market in the remainder of 2023, according to the Realtor 2023 Forecast Update.

While prices have eased slightly, higher mortgage rates are hurting affordability, and many of those who already own a home are not incentivized to list. As a result, the total number of home sales (projected to be down 15.8% to 4.2 million) is likely to be at its lowest point since 2012. On the rental side, prices are expected to drop slightly on the year (-0.9%), as strong multi-family construction is improving inventory.

“High inflation and the Fed’s actions to curb it have had a significant impact on the housing market this year. And while inflation has begun to ease, the sustained spike in mortgage rates was enough to stifle the housing market after several years of low rates and strong activity,” said Realtor Chief Economist Danielle Hale. “The housing market has really seen a double whammy in 2023, with a retrenchment in the number of homes for sale coupled with still-high prices and mortgage rates that have kept both first-time and repeat buyers on the sidelines.”

Affordability improving, but still a long way to go
Home prices have been supported by persistent underbuilding relative to household growth over the last decade, but low affordability has had an outsized impact on demand. As a result, Realtor now expects a modest decline in home prices of 0.6% for the year. The expectation is that mortgage rates will also be slightly lower than originally anticipated, but not low enough to bring down buying costs until the end of the year. As inflation is expected to cool gradually, we expect that mortgage rates will start to do the same beginning mid-year and nearing 6% by the end of the year. For the year as a whole, the cost of a mortgage is expected to be up 10.5% compared to 2022.

Mortgage rate lock-in effect impacting inventory
Realtor expects home sales to decline 15.8% in 2023 for a total of about 4.2 million sales for the year, the smallest annual total since 2012. Mortgage rate lock-in has been a stronger factor than initially expected, and the number of homes for sale has not met initial projections. As a result, the expectation now is for inventory levels to slip 5% for the year, and not the growth projected in the initial forecast.

“The vast majority of homeowners locked in low rates during the pandemic and aren’t particularly excited to give them up in order to buy a new home, unless they really need to move for personal reasons,” said Hale.

Rental prices pull back
Challenging conditions in the housing market will lead many to continue renting, driving ongoing demand for rentals through the second half of 2023. However, the strong uptick in new multi-family construction and people choosing to stay in their unit in order to save money is likely to decrease competition for new units and lead to a slight annual decline in rental prices (-0.9%). However, despite this pull-back, rental prices are still historically high with the average rent about $350 more than it was pre-pandemic.

Other economic factors to consider
Despite the Fed’s tightening, the economy and labor markets have shown resilience. And while paychecks haven’t kept pace with inflation, Americans have dipped into pandemic savings and continued to spend money. While this is boosting the current economy, it could have an impact in the future if consumers burn through savings and need to rely on high-interest debt.

Investors Trust Opens New Office in Kuala Lumpur

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Investors Trust will be opening a new Asia sales hub in Kuala Lumpur, Malaysia. The hub will serve as their new service point in Asia, which will  allow the company to expand its operations and provide even better service to its clients and  financial advisors, the firm said. 

The new state-of-the-art facility, located in the prestigious Exchange 106 tower in the new central business district of Tun Razak Exchange, will provide an attractive and modern work ing environment for their Asia sales team along with an impressive location for Investors  Trust’s business partners from around the world, states the text.  

“The relocation of our Asia hub continues our longstanding commitment to the region and  further expands our presence in Malaysia where ITA Asia Ltd is registered as a licensed Insur er by the Labuan Financial Services Authority,” said David Knights, Head of Distribution Asia at  Investors Trust. 

The new office is part of the restructure of Investors Trust (ITA) operations in the region and will serve as the Investors Trust service hub in Asia after the closure of the Hong Kong office on June 30th,  2023. The relocation is a strategic decision that reflects the company’s preference to concern trate their sales and operations functions in one location where ITA is fully licensed in order to  provide optimal service and expand its reach across the region.

Janus Henderson launches fixed maturity bond fund

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Janus Henderson Investors announced the launch of its USD fixed maturity bond fund.

The Janus Henderson Fixed Maturity Bond Fund (USD) 2027, which aims to provide a regular income whilst also aiming to preserve the initial capital invested over the term of the portfolio, will invest in a well-diversified portfolio of primarily investment grade bonds from developed markets around the world. Utilising in-depth fundamental company research the fund aims to exploit price inefficiencies and enhance yield with an emphasis on loss avoidance and minimal turnover.

The Fund’s investment team comprises portfolio managers in the firm’s global corporate credit team: James Briggs, Michael Keough, Brad Smith, Tim Winstone and Carl Jones who have over 14 years’ experience in managing portfolios with specific yield and maturity targets. The portfolio managers cover investment grade, high yield and blended solutions and fully leverage the global corporate credit team’s industry sector insights to enhance portfolio yields. They focus on avoiding defaults and downgrades, while identifying adequate compensation for risk taken.

James Briggs, Corporate Credit Portfolio Manager at Janus Henderson Investors said: “Yields on investment grade corporate bonds have risen substantially to levels not seen since the 2008/09 financial crisis. Interest rates and yields are likely to fall as inflation subsides so now is a particularly advantageous time to lock in these yields. A fixed maturity bond not only allows investors to lock in attractive front-end yields ahead of potential rate declines, but investors can capture this high income for relatively low risk as attractive yields on short-dated investment grade credit mean investors can avoid taking on excessive duration or credit risk.” 

Ignacio De La Maza, Head of EMEA Intermediary & LatAm, said: “Our extensive experience in managing investment grade corporate bonds give us the confidence to build a fixed maturity bond fund for investors with income in mind. The team’s active approach, combined with a disciplined and repeatable process to monitor the evolution of portfolio risks is designed to deliver consistently to client expectations.”

The Fund will mature in January 2027 and aims to pay regular coupons at a quarterly rate.

Mariva Capital Markets Announces New Managing Director to Expand its Reach with Emerging Markets Institutional Investors

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Mariva Capital Markets LLC has announced Victor Lugo, CFA, incorporation to the firm as Managing Director. 

Lugo, based in Miami, brings with him twenty years of experience developing and managing relationships with institutional investors in emerging markets: from asset managers and mutual funds to private wealth platforms and insurance companies, among others. 

In addition, he has six years of experience in private banking himself, including roles in trading and devising investment strategy and asset allocation, the firm said in a statement.  

As Mariva Capital Markets develops its international presence, Lugo will be instrumental in building out the firm’s reach with emerging markets institutional investors in the Americas and Europe. 

His client reach with dedicated investors complements Mariva’s existing business and will be immediately accretive.  His additional responsibilities will include augmenting the firm’s focus markets within Latin America.

Lugo has spent time in various international banks, including Santander, ING Group, Morgan Stanley, Credit Agricole and, most recently, SMBC.

 

Man Group to Acquire Varagon Capital Partners

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Man Group announces it has entered into an agreement to acquire a controlling interest in Varagon Capital Partners, L.P., a leading U.S. middle market private credit manager with $11.8bn of AUMs and $15.4bn of total client commitments.

Founded in 2014, Varagon is a leader in the core U.S. middle market, having completed $24.5bn of financings to over 300 companies and 138 sponsors. The firm focuses on senior secured loans with multiple covenants to cash generative, high-performing sponsor-backed companies in non-cyclical industries, and typically serves as a lead or co-lead lender, with origination capabilities that support enhanced terms and differentiated returns for investors. Varagon offers this strategy through a range of market-validated investment vehicles, including separately managed accounts, private funds, and rated note products.

Upon completion of the transaction, Walter Owens, CEO of Varagon, will continue to manage the Varagon business, supported by its existing 88 team members across offices in New York, Fort Worth and Chicago. Varagon’s investment committee, investment team and investment processes will remain unchanged, and the firm’s access to new investors will be bolstered by Man Group’s global distribution.

Varagon’s strong and experienced management team and high-quality, sophisticated client base, with a particular emphasis on the insurance channel, bring significant institutional credibility to support Man Group’s growth in U.S. private credit. The acquisition will enhance Man Group’s investment capabilities, equipping the firm with a complementary U.S.-focused direct lending strategy designed to provide consistent risk-adjusted outperformance. Crucially, Varagon brings the ability to deploy these investment capabilities at scale in a customisable format to the world’s largest institutional investors.

Under the terms of the Acquisition Agreement:

  1. At completion, Man Group will pay $183m in cash to selling interest holders Aflac, Corebridge Financial, American International Group, and former members of Varagon’s management team.
  2. The cash consideration will be funded using existing internal resources. It will be subject to a closing balance sheet adjustment reflecting any excess or deficit against a minimum working capital target.
  3. Aflac, Corebridge and AIG, which account for over half of Varagon’s client commitments, have agreed to continue their existing multi-year investment management agreements. Subject to maintaining a predetermined level of capital commitments over a nine-year period, extension payments of up to $93m in total will be payable in cash to Aflac, Corebridge and AIG.
  4. Varagon’s management team will roll all of its existing 27% interest into a structure that ensures long-term alignment with the combined business; + and management will have a reciprocal put / call option over the residual stake at fair market value in years 8, 9 and 10, subject to certain conditions.

Eric Burl, Head of Discretionary at Man Group, said: “This acquisition reflects our long-term strategy to move into new market segments where we can differentiate ourselves with talented, specialised teams. Man Group has built a rich and diversified credit offering to date, and as client demand for credit strategies is increasing, we see a significant growth opportunity in direct lending, particularly against the backdrop of regional banking difficulties in the U.S. This transaction enhances our ability to provide deep, fundamental credit expertise through a cycle, underpinned by risk management of the highest quality.”

Robyn Grew, Incoming CEO at Man Group, commented: “We are thrilled to have Varagon join Man Group as an additional investment engine. This acquisition is indicative of our commitment to diversifying our client offering and our strategic expansion ambitions in the U.S. Varagon has built a high-quality investment platform and shares our vision to deliver outperformance for clients. Our extensive distribution network and operational expertise will support Varagon with its continued growth and delivery for clients, and we very much look forward to working with such a strong team.”

Walter Owens, CEO at Varagon, said: “We are excited to be joining Man Group, a world-class investment firm with global distribution capabilities, a strong brand and infrastructure, and a like-minded, collaborative culture. Man Group’s deep experience building bespoke solutions for clients and best-in-class technology will help us to better serve our clients and further reinforce our position as a differentiated capital solutions provider in the core middle market. The private credit market continues to grow in relevance for many investors, and fundamental credit analysis and disciplined underwriting skills will come to the fore as the environment for borrowers in the U.S. becomes more challenging. We believe a combination of Man Group and Varagon will enable us to preserve our proven investment process while helping us scale our suite of products and continue to deliver compelling results to our clients and sponsor partners.”

The U.S. middle market is one of the world’s largest, with over 200,000 middle market companies generating one third of U.S. private sector GDP. U.S. pension fund allocations to private credit stood at $3.2 trillion in 2022, representing 3.6% of total allocations compared with 2.1% in 2017.

Varagon has delivered compound AUM growth of 13% over the three years to 31 December 2022. In 2022, Varagon generated total revenues of $116.3m and profit before tax of $30.9m. Total gross assets were $165.8m in December 2022. These figures have been extracted from the audited accounts of Varagon for the year ended 31 December 2022, which have been prepared in accordance with U.S. GAAP. Man Group expects the transaction to be meaningfully accretive to management fee and total EPS in the first full year following completion, according to the firm.

Wells Fargo Securities is acting as lead financial advisor and Willkie Farr & Gallagher LLP is acting as legal advisor to Man Group and/or its U.S. affiliates. Rothschild & Co. Inc. is acting as lead financial advisor and Davis Polk & Wardwell LLP is acting as legal advisor to Varagon.

The transaction is subject to regulatory approvals and is expected to complete in Q3 2023. On completion, Varagon will become known as Man Varagon. The proposed acquisition of Varagon is a Class 2 transaction pursuant to the UK Listing Rules. This announcement contains inside information and the person responsible for arranging the release of this announcement on behalf of Man Group is Elizabeth Woods, Company Secretary.

BofA Data Finds Men’s Average 401(k) Account Balance Exceeds Women’s by 50%

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Bank of America released its 2023 Financial Life Benefits® Impact Report, revealing that the average 401(k) account balance among men is 50% greater than women’s overall ($89,000 vs. $59,000).

However, this gender imbalance is closing among younger generations. Baby Boomer (ages 58-76) and Gen X (ages 43-57) men have significantly greater account balances than women in their generations (87% vs. 53%, respectively). However, the gap between Millennial (ages 28-42) men and women is only 23%. Gen X continue to have the highest 401(k) participation rate (65%) across generations, followed by 57% of Baby Boomers and 55% of Millennials.

“The gender savings gap is an issue we can and must address. It carries personal implications for many, as well as macroeconomic implications for us all,” said Lorna Sabbia, Head of Retirement and Personal Wealth Solutions at Bank of America. “We are encouraged by the strides young, female employees are making, and want to encourage everyone to invest in their futures and leverage the workplace benefits available to them.”

Based on data across Bank of America’s proprietary employee benefits programs, which serve more than 25,000 companies and more than 6 million employees, the Financial Life Benefits Impact Report examines trends within 401(k) plans, Health Savings Accounts (HSAs), equity compensation and employee banking programs.

When looking at 401(k) savings plans as of the end of last year: Participation rates dropped only slightly to 56% from 58% in 2021; Average contribution rate declined to 6.4% from 6.6% in 2021; 26% of participants increased their contribution rate as compared to 8% of participants who decreased their savings rate; The number of participants contributing small amounts (less than $5,000) increased to 66% (from 61% in 2021), while only 9% took full advantage of their 401(k) plan by contributing the maximum amount allowed; Overall account balances declined by 17% related to stock and bond market declines; When 401(k) plans include an auto-enroll feature, most employees (85%) participate, compared to just 36% participation without this feature; Plans with auto-enroll that also have auto-increase rose (57% vs. 55% in 2021).

In addition to 401(k) savings plans, employees are leveraging other benefits such as HSAs, equity awards and other financial resources to pursue their goals. Top findings related to these benefits include more employees received equity awards in 2022, though values were lower; HSA account holders are evolving from “spenders” to “savers; financial education resources are top of mind; participants want to engage digitally.

“Employers serve an important role in ensuring that their employees are equipped with the best possible tools, resources and solutions for financial success and retirement planning,” said Kevin Crain, Head of Retirement Research & Insights at Bank of America. “We’re committed to working with employers to meet the needs of their employees, wherever they are in their financial journey.”

Candriam and New York Life Investments Partner to Expand Candriam’s offshore business

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Candriam and New York Life Investments announced their expanded partnership to deliver offshore capabilities and solutions reaching global investors whose wealth is managed in the US.

With this expanded partnership, investors in the US offshore market will gain access to certain Candriam multi-billion-dollar flagship UCITS funds with deep expertise, long track records, global investor bases and sizeable assets under management.

The range of UCITS funds cover strategies including US high yield corporate bonds, emerging market equity and debt, and thematic strategies that are actively involved in areas such as cancer research, innovative technologies, and biotechnology. In some cases, Candriam will be able to offer clones of existing US mutual funds, managed by its affiliates, for the first time to these investors.

New York Life Investments’ sales teams will use their on-the-ground relationships in the US and leverage the company’s scale to support introductory conversations with US-based broker-dealers and financial firms. This approach aims to unlock new opportunities, enabling these groups and their end clients to benefit from Candriam’s proven investment strategies.

Jac McLean, Head of U.S. Distribution at New York Life Investment Management, said: “With Candriam’s investment excellence and track record in Europe and across the globe, combined with our relationships with major platforms in the US, we are well positioned to leverage our scale, resources, and distribution channels to meet the evolving needs of US offshore clients. Our daily conversations with US advisors enable us to see first-hand how tricky market dynamics are driving their offshore clients to seek new investment ideas; these insights, in turn, empower our sales teams to work closely with intermediaries and platforms to deliver best-in-class solutions to this market segment.”

“Expanding access to Candriam’s renowned global strategies in the US offshore market aligns with our commitment to continue to provide a range of new and creative investment opportunities for intermediaries and end clients.”

Keith Dixson, Head of International Development at Candriam, continued: “There is a significant opportunity in the US offshore market to match evolving investor demand in these regions with innovative solutions. International investors are seeking high yielding strategies, along with diversifiers for their portfolios which are increasingly centered on global thematic solutions that take advantage of structural trends.”

“We look forward to expanding these solutions for clients and working closely with intermediaries to bring new opportunities to their clients in these markets. This increases our global coverage and is a natural next step to growing the business.”

Candriam is a first mover in multiple strategies. The firm was one of the first market participants to offer a range of long-term thematic investments driven by megatrends, and now has over 20 years’ experience and $16bn AUM across thematic strategies.

Candriam’s growth in the US offshore market will support ongoing sales efforts in Latin America, led by Candriam’s sales team in Spain.

Rookie Advisors Are in Short Supply 

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The number of new advisors entering the industry is barely offsetting retirements and trainee failures as firms struggle with high wash-out rates. To help advisors succeed, firms across all channels must work to build a diverse talent pipeline and enhance rookie development programs, according to the latest Cerulli Edge—U.S. Asset and Wealth Management Edition.

Financial advisor headcount grew by just 2,579 advisors in 2022, after a rookie advisor failure rate of more than 72%. In response to high attrition, financial services firms must work on developing sustainable talent pipelines that capture a wider range of talent.

Currently, new advisor recruiting is driven largely by word-of-mouth referrals—nearly two-thirds (64%) of rookie advisors were recruited this way. This informal recruiting process makes it more challenging for firms to reach a broad cross-section of applicants.

“Rookie advisors come from all different backgrounds,” says Stephen Caruso, research analyst. “Just 15% of rookies report financial advisor as their first career and only 43% of rookie advisors have previously worked in financial services. Broker/dealers (B/Ds) and registered investment advisors (RIAs) must find new avenues for connecting with potential candidates and spreading awareness about the profession,” he adds.

Within the firm, structured training programs will be key to advisor success. Almost half (45%) of rookie advisors report that their responsibilities include managing small-balance accounts for a senior advisor, which can be a great learning opportunity for rookies who need client-facing experience. However, keeping rookies in a support role for too long can limit their growth and make it difficult for them to develop their own clients, given that 69% are responsible for building their own client base from scratch.

“A well-structured training program should gradually shift rookie advisors into production and provide a natural progression of their roles and responsibilities, so that practices can capitalize on a new resource without boxing a rookie into an operational or support role,” says Caruso. “RIA custodians and B/D home offices should actively support this transition process by providing best practices and a framework advisors can use to train future successors.”

Overall, as advisor headcount weakens, firms will need to focus their efforts on developing talent in-house. While historically, large B/Ds have driven headcount growth primarily by luring away experienced advisors from competitors, firms will need to shift gears to the growth and development of rookie advisors.

Emerging Markets are Thriving Amid a Slow Global IPO Market

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Globally, year-to-date (YTD) 2023 recorded 615 IPOs with US$60.9b capital raised, a 5% and 36% decrease year-over-year (YOY).

Larger deals came to the market in Q2 compared to Q1, even though it has been a slow recovery. These modest results reflect slower global economic growth, tight monetary policies and heightened geopolitical tensions. However, some emerging markets are booming with IPO activities, as they benefited from the global demand for rich mineral resources, their vast population, growing unicorns and entrepreneurial small- and medium-sized enterprises (SMEs). These and other findings are available in the EY Global IPO Trends Q2 2023.

While the technology sector continues to be the leading sector in IPO activities to date in 2023, IPO proceeds raised by companies of the energy sector have dwindled on the back of softer global energy prices. As well, cross-border activity has experienced a significant surge in both volume and proceeds, primarily attributed to the growing influx from China into the US and a steady flow into the Swiss Stock Exchange.

The special purpose acquisition company (SPAC) market continued to be challenged with negotiations becoming increasingly complex. There is still an exorbitant number of SPACs yet to announce or complete a de-SPAC, which are facing liquidation by the expiration period in the next six months. However, we do expect SPAC IPO activities to return to a more sensible and sustainable level that were seen pre-2021.

Overall regional performance: Q2 performed better than Q1

While the number of IPOs remained flat, the Americas region saw an increase in proceeds of 86%, raising US$9.1b, YOY. This growth was primarily attributed to a single mega spin-off IPO, which happened to be the largest US IPO since November 2021. The US experienced an uptick driven primarily by a few large deals and recent improvements in market sentiment could be a sign for more US IPO activity later in 2023 or 2024. However, despite the positive developments, it may take the overall Americas IPO market longer to recover than many market participants forecasted at the beginning of the year due to the unforeseen banking crisis in 2023.

YTD, the Asia-Pacific IPO market has maintained its position as the global leader in IPO volume and value, with an approximate 60% share. Of the top 10 global IPOs, half were from Mainland China and one was from Japan. The region saw 371 IPOs raising US$39.4b in this period, a YOY fall of 2% and 40% respectively – proceeds were down significantly due to a cooler-than-expected Mainland China IPO market, with many large IPOs waiting on the side-line. For the first time in more than 20 years, Indonesia has surpassed Hong Kong in the global stock exchange rankings by deal number.

EMEIA IPO activity has continued to shrink, with 167 listings raising US$12.4b YTD, a 12% and 50% fall YOY, respectively. Despite this, the region kept its position as the second largest IPO market with 27% of all IPO deals, and saw the second biggest IPO at US$2.5b. India exchanges also broke a two-decade streak, jumping to the top spot in deal count. However, inflation levels in most European countries remain challenging, and the lack of liquidity continues to hold back IPO activity.

2H 2023 outlook: pipeline still in holding

A resurgence in global IPO activity is anticipated to start late 2023 as economic conditions and market sentiment gradually improve with the tight monetary policy entering its final stage.

After the one mega spin-off IPO debut in the US that outshone all other traditional IPOs, there are strong indications that this trend will persist. Large corporate spin-offs and carve-out listings will likely surface across major markets, as companies seek to create more shareholder values through divestiture while investors lean toward mature, profit-making businesses amid a yet-to-revive IPO market.

Understanding the different requirements of each IPO market that companies plan to enter is essential to meet investor expectations and avoid potential delays due to regulatory issues. Investors will continue to be more selective, orienting toward companies with solid fundamentals and proven track record. All options, from alternative IPO processes (direct listing or de-SPAC merger) to other financing methods (private capital, debt or trade sale), should be considered.

Big Banks Are Well Positioned to Weather a Severe Recession, Fed says

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The Federal Reserve Board on wednesday released the results of its annual bank stress test, which demonstrates that large banks are well positioned to weather a severe recession and continue to lend to households and businesses even during a severe recession.

“Today’s results confirm that the banking system remains strong and resilient,” Vice Chair for Supervision Michael S. Barr said. “At the same time, this stress test is only one way to measure that strength. We should remain humble about how risks can arise and continue our work to ensure that banks are resilient to a range of economic scenarios, market shocks, and other stresses.”

The Board’s stress test is one tool to help ensure that large banks can support the economy during economic downturns. The test evaluates the resilience of large banks by estimating their capital levels, losses, revenue and expenses under a single hypothetical recession and financial market shock, using banks’ data as of the end of last year.

All 23 banks tested remained above their minimum capital requirements during the hypothetical recession, despite total projected losses of $541 billion. Under stress, the aggregate common equity risk-based capital ratio—which provides a cushion against losses—is projected to decline by 2.3 percentage points to a minimum of 10.1 percent.

This year’s stress test includes a severe global recession with a 40 percent decline in commercial real estate prices, a substantial increase in office vacancies, and a 38 percent decline in house prices. The unemployment rate rises by 6.4 percentage points to a peak of 10 percent and economic output declines commensurately.

The test’s focus on commercial real estate shows that while large banks would experience heavy losses in the hypothetical scenario, they would still be able to continue lending. The banks in this year’s test hold roughly 20 percent of the office and downtown commercial real estate loans held by banks. The large projected decline in commercial real estate prices, combined with the substantial increase in office vacancies, contributes to projected loss rates on office properties that are roughly triple the levels reached during the 2008 financial crisis.

The $541 billion in total projected losses includes over $100 billion in losses from commercial real estate and residential mortgages, and $120 billion in credit card losses, both higher than the losses projected in last year’s test. The aggregate 2.3 percentage point decline in capital is slightly less than the 2.7 percentage point decline from last year’s test but is comparable to declines projected from the stress test in recent years. The disclosure document includes additional information about losses, including firm-specific results and figures.

For the first time, the Board conducted an exploratory market shock on the trading books of the largest banks, testing them against greater inflationary pressures and rising interest rates. This exploratory market shock will not contribute to banks’ capital requirements but was used to further understand the risks with their trading activities and to assess the potential for testing banks against multiple scenarios in the future. The results showed that the largest banks’ trading books were resilient to the rising rate environment tested.

The individual results from the stress test factor directly into a bank’s capital requirements, mandating each bank to hold enough capital to survive a severe recession and financial market shock. If a bank does not stay above its capital requirements, it is subject to automatic restrictions on capital distributions and discretionary bonus payments.