Fifth Third Bank 2014 Annual Report Download - page 82

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
80 Fifth Third Bancorp
Statements for a discussion on the FRB’s review of the capital plan,
the FRB’s non-objection to the Bancorp’s proposed capital actions
and the Bancorp’s capital actions taken in 2014.
The BHCs that participated in the 2014 CCAR, including the
Bancorp, are required to conduct mid-cycle company-run stress
tests using data as of March 31, 2014. The stress tests must be based
on three BHC defined scenarios – baseline, adverse and severely
adverse. As required, the Bancorp reported the mid-cycle stress test
results to the FRB on July 7, 2014. In addition, the Bancorp
published a Form 8-K providing a summary of the results under the
severely adverse scenario on September 18, 2014, which is available
on Fifth Third’s website at https://www.53.com. These results
represented estimates of the Bancorp’s results from the second
quarter of 2014 through the second quarter of 2016 under the
severely adverse scenario, which is considered highly unlikely to
occur.
The FRB launched the 2015 stress testing program and CCAR
on October 23, 2014. The stress testing results and capital plan were
submitted by the Bancorp to the FRB on January 5, 2015.
The FRB expects to release summary results of the 2015 stress
testing program and CCAR in March of 2015. The results will
include supervisory projections of capital ratios, losses and revenues
under the supervisory adverse and supervisory severely adverse
scenarios. The FRB will also issue an objection or non-objection to
each participating institution’s capital plan submitted under CCAR.
The FRB’s summary results will also include an overview of
methodologies used for supervisory tests. Additionally, as a CCAR
institution, Fifth Third is required to disclose its own estimates of
results under the supervisory severely adverse scenario using the
same consistently applied capital actions noted above, and to
provide information related to risks included in its stress testing; a
summary description of the methodologies used; estimates of
aggregate pre-provision net revenue, losses, provisions, and pro
forma capital ratios at the end of the forward-looking planning
horizon of at least nine quarters; and an explanation of the most
significant causes of changes in regulatory capital ratios. These
disclosures are required to be sent to the FRB and publicly disclosed
within 15 days of the date the FRB discloses the results of its DFA
supervisory stress test.