Updated Primer on the Forward-Looking Analysis of Risk Events (FLARE) Model: A Top-Down Stress Test Model

RePEc Short ID: pco826
ORCID iD: 0000-0002-0914-8648

Correia, Sergio A.; Seay, Matthew P.; Vojtech, Cindy M.

doi:10.17016/FEDS.2022.009

Working Paper

Updated Primer on the Forward-Looking Analysis of Risk Events (FLARE) Model: A Top-Down Stress Test Model

Abstract: This is an updated technical note describes the Forward-Looking Analysis of Risk Events (FLARE) model, which is a top-down model that helps assess how well the banking system is positioned to weather exogenous macroeconomic shocks. FLARE estimates banking system capital under varying macroeconomic scenarios, time horizons, and other systemic shocks.

Keywords: Bank capital; Financial insitutions; Stress test;

JEL Classification: G21;

https://doi.org/10.17016/FEDS.2022.009