Large Cap Banks CCAR 2026 Preview: Cat IV Banks SCB Reduction, Wells Changes Impact on SCB; Unusual Trading Result Reversal? NBFI Treatment?

Research evidence excerpt

Large Cap Banks CCAR 2026 Preview: Cat IV Banks SCB Reduction, Wells Changes Impact on SCB; Unusual Trading Result Reversal? NBFI Treatment?

ough this would not go into effect for another year. Some, Esp. Cat IV Banks, dated February

Conversely, banks whose SCB goes up meaningfully would likely see stocks fall 5, 2026

as this is not expected by the market.

• Banks have seen several changes that would impact results in the 2026 CCAR ‘26: New Process, Metrics; No

stress test, some that would benefit their SCB and others that would hurt it: 1) Material Change to Capital Requirements

lower starting point of capital due to reduction in capital levels for several – Cat IV Banks Modest Risk of Increase?

banks but up a little for some regionals, which would impact comparison versus Wells 1 Year Reprieve?, dated October

the capital required under the stress test; 2) reduction in loan loss reserves at 27, 2025

YE25 versus YE24 for most of our banks; 3) changes in loan mix – impact

would depend on what type of loans increased and decreased as regards credit

Commercial Credit: Credit Metrics Stable;

losses and revenues; 4) changes in run-rate pre-provision net revenue (PPNR)

Watching Rising Private Credit Defaults

– most of our banks increased PPNR yoy in FY25 except Wells Fargo; 5) faster

and Sectors Impacted by AI, Inflation,

growth in NBFI (non-bank financial institution) loans, especially in loans to

War, dated June 4, 2026

private credit in FY25 and unclear how Fed will treat those; and 6) sizable/high

growth in trading assets at all banks subject to the trading shock.

Consumer Credit: Credit Metrics Holding

• We expect dividends to increase post stress test at almost all our banks and Up – Impact of Inflation, AI Key expect share buybacks at all our banks.