Stress-testing is an established part of the capital and risk management toolkit for financial services firms, having been part of banks’ self-evaluation process for decades. But since the global financial crisis that began in 2007–08, subsequent waves of regulation have seen the volume, range and complexity of tests rise, placing increasing demands on firms’ data, systems and resources.

While the stress scenarios, dry-runs, and safety measures introduced since 2008 have proved helpful in preparing the financial system for the shock of Covid-19, the pandemic has raised a new set of questions, as regulators and risk managers reassess the value of their current frameworks and consider how best to account for non-financial risks within the stress-testing arena.

This special report explores the future of stress-testing in the post-Covid-19 era, how firms are tackling the operational and technological challenges involved and how they can maximise value from the strategic insight afforded by the process.