The Basel Committee is consulting on principles for stress testing practices and supervision. Its paper looks at how stress testing performed during the financial crisis and highlights the weaknesses in the pre-turmoil methods. It suggests specific recommendations focused on:  

  • use of stress testing and integration in risk governance;
  • stress testing methodology and scenario selection;and
  • specific areas of focus.  

It also makes recommendations to supervisors. It wants comments by 13 March.