2026 CCAR shows a slight decline in indicative SCBs, but actual capital requirements remain unchanged

Overview

This report reviews the 2026 U.S. banking sector CCAR stress test results. The core conclusion is that the results were broadly positive: all banks passed, industry capital depletion was below the historical average, and indicative SCBs declined slightly from last year; however, because the Federal Reserve is reviewing the CCAR process, this round of results is informational only, and 2025 SCBs will remain in effect, so actual capital requirements are unchanged.

Core views

Goldman Sachs believes that if the 2026 results were binding, banking sector capital requirements would decline modestly. Indicative SCBs for large banks are about 2.7%, down from 2.8% last year, mainly driven by a significant improvement in PPNR. At the stock level, JPM is one of the few large banks with a higher indicative SCB, rising 30bps to 2.8%; MS fell 50bps to 3.8%, and C fell 40bps to 3.2%. Regional banks and consumer finance companies performed reasonably well overall, with most regional/super-regional banks showing implied SCBs at the 2.5% floor.

Analysis framework

Using the Federal Reserve's 2026 severely adverse scenario stress test results, together with announced or consensus-expected dividends, the report estimates banks' indicative SCBs, excess capital above minimum capital requirements, DPS changes, dividend yields, and changes in PPNR, provisions, loan loss rates, and trading losses under the stress scenario.

Methodology notes

• Regulatory stress testingCCAR and Stress Capital Buffer

  Estimate indicative SCBs using capital depletion and planned dividends under the severely adverse scenario.

  The report emphasizes that the 2026 results are not binding, so indicative SCBs are used to analyze potential changes in capital requirements rather than current formal regulatory requirements.

• Earnings and loss decompositionPPNR, provision, and loan loss rate analysis

  Assess stress test performance through pre-provision net revenue, provisions, loan loss rates, and other losses.

  Large-bank PPNR rose 33% YoY, but provisions increased 10% YoY, while CRE, C&I, and credit card loss rates increased, offsetting some of the positive impact.

• Capital returnDPS and dividend yield estimation

  Estimate annual CCAR dividend changes based on company-announced dividend plans and consensus expectations.

  The report assumes no further DPS adjustments from 3Q26 to 2Q27 and uses consensus earnings forecasts to estimate payout ratios.

• Scenario limitationsExcludes G-SIB buffer, Basel 3 Endgame, and 2Q26 capital changes

  Capital requirement estimates exclude certain potential regulatory or capital-level changes.

  The report explicitly states that the estimates do not reflect the G-SIB buffer, Basel 3 Endgame changes, or improvements or deterioration in capital levels since 2Q26.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• U.S. large banks (BAC, C, JPM, MS, PNC, USB, WFC)

  CCAR and SCBs directly affect minimum capital requirements, excess capital, and capacity for shareholder returns.

  Strengths

  Large banks showed a significant overall improvement in PPNR, with average dividends up 10%, and most banks' indicative SCBs flat or lower.

  Weaknesses

  Provisions rose YoY, CRE and C&I loss rates increased, and JPM's indicative SCB rose 30bps.

  Comparison

  MS and C saw the largest SCB declines, down 50bps and 40bps, respectively; BAC, PNC, and WFC were largely flat.

  Risks

  Formal capital requirements are unchanged, and the G-SIB buffer, Basel 3 Endgame, and changes in capital levels could alter the final constraint.

• Regional and super-regional banks (CFG, FITB, KEY, MTB, FCNCA, etc.)

  Stress test results are used to assess regional banks' positions relative to minimum SCBs and capital buffers.

  Strengths

  Among 9 regional/super-regional banks, most implied SCBs are at the 2.5% floor, with significant improvement at CFG, FITB, and KEY.

  Weaknesses

  FCNCA's implied SCB is about 4.5%, indicating weaker performance, possibly related to its first test participation and the treatment of legacy SVB business.

  Comparison

  CFG improved by 200bps versus the 2024 test, FITB by 70bps, KEY by 60bps, and MTB returned to the 2.5% level for the first time.

  Risks

  Credit losses and commercial real estate risk at regional banks may still create pressure.

• Consumer finance (COF, AXP, ALLY, SYF)

  Credit card and consumer loan loss rates affect stress test capital depletion.

  Strengths

  COF's implied SCB fell 80bps to 3.7%; SYF performed strongly in its first test participation, with an implied SCB of 2.5%.

  Weaknesses

  Overall credit card loss rates rose 20bps YoY to 17.1%, making consumer credit an important sensitivity.

  Comparison

  AXP and ALLY results were relatively stable, with ALLY up about 10bps; SYF's card loss rate was below that of peer COF.

  Risks

  If consumer credit quality deteriorates, future provisions and capital pressure could rise.

• Trust banks (BK, NTRS)

  Dividend announcements and leverage capital constraints influence capital return assessment.

  Strengths

  BK and NTRS dividends were above Visible Alpha consensus expectations by about 7% and 5%, respectively.

  Weaknesses

  Actual constraints for trust banks come more from Tier 1 leverage, which differs from the CET1 excess capital presentation.

  Comparison

  BK's dividend grew about 19% YoY during the 2026 CCAR period, one of the larger increases.

  Risks

  Using only the CET1 measure may underestimate the importance of leverage capital constraints.

Key data

• Test release date2026-06-24The Federal Reserve released the 2026 annual CCAR results.
• Industry capital depletion1.4%Below the five-year average of 1.9%.
• Indicative SCB2.7%Below last year's 2.8%, but the results are not binding.
• Large-bank PPNR+33% YoYMainly driven by higher NII and fee income, partly offset by higher expenses.
• Large-bank provisionsAbout $329 billion, +10% YoYTotal provisions for the top 7 banks increased YoY under the stress scenario.
• Loan loss rate6.9%, +30bps YoYCRE loss rate rose to 8.8%, C&I to 9.0%, and credit cards to 17.1%.
• Trading losses$29 billion, -24% YoYTrading losses across the covered U.S. investment banks declined from $38 billion to $29 billion.
• Excess capital$314 billionBased on indicative SCBs, equal to about 9% of participating banks' market capitalization.
• Average large-bank dividend growth+10%MS, WFC, JPM, and USB raised dividends by 15%, 11%, 10%, and 4%, respectively.
• Annual CCAR dividend yield2.1%Goldman Sachs estimates an increase from 1.8% to 2.1%, with the payout ratio expected to rise to 29%.

Impact & implications

The report has a somewhat positive implication for capital return and capital adequacy in the U.S. banking sector: stress test results show low industry capital depletion, improved PPNR, and ample excess capital, supporting dividend increases at multiple banks. However, because the 2026 results are not binding, the investment implications are more informational and sentiment-driven, while short-term formal capital requirements are still determined by 2025 SCBs.

Risks

• The 2026 CCAR results are not binding, and 2025 SCBs will remain applicable, so actual capital requirements will not decline immediately based on these results.
• The Federal Reserve's comprehensive review of the CCAR process is not yet complete, and future framework changes could alter capital buffer calculations.
• The report's estimates do not include the G-SIB buffer, Basel 3 Endgame, or changes in capital levels since 2Q26.
• CRE and C&I loss rates increased meaningfully YoY, indicating that credit risk in the stress scenario is still rising.
• Provisions increased 10% YoY, which may offset part of the capital benefit from improved PPNR.
• Dividend plans and capital return still depend on subsequent company announcements, regulatory communication, and capital market conditions.

What to watch

• The final outcome of the Federal Reserve's CCAR process review, and the specific implementation arrangements for extending 2025 SCBs through 2027.
• Whether banks update capital targets or management buffers before the formal SCB effective period from 4Q26 to 3Q27.
• The impact of G-SIB buffer and Basel 3 Endgame changes on minimum capital requirements for large banks.
• Whether CRE, C&I, and credit card loan loss rates continue to rise.
• Whether large-bank PPNR growth is sustainable, especially in NII, fee income, and expense control.
• Whether banks' subsequent dividend, buyback, and capital return plans exceed or fall short of market expectations.