Stress tests at risk of becoming too complex, say bank heads

Regulator demands could lead to "tick-the-box" exercise, hear delegates at Quant Summit Europe

The increasing number and complexity of supervisory stress tests is likely to render them less effective, and risks turning them into a “tick-the-box” exercise, according to bank stress-testing heads.

Speaking as part of a panel discussion at Quant Summit Europe on April 13, Duško Dincov, global head of international banking stress-testing at Barclays, suggested complex stress-testing methodologies would make it more difficult to use the outputs as a tool to understand and manage the business