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ST-1.7.2

Stress testing estimates the exposure to a specified stress event or scenario, but does not give the probability of such an event or scenario occurring. Moreover, stress testing is influenced by the judgment and experience of the experts designing the stress tests. The effectiveness of stress testing therefore, depends, in particular, on whether the bank has chosen the 'right' scenarios for stress testing, interpreted the results properly and taken the necessary steps to address the results.

July 2018