The Financial Post reports in its Tuesday, July 12, edition that Moody's Investors Service says severe stress in the oil and gas sector could prompt some Canadian banks to trim dividends. The Post's Barbara Shecter writes that Moody's stress tested the impact on bank capital of a severe scenario stemming from low oil prices. It concluded that there are a number of steps Canada's seven largest banks could take to conserve capital before resorting to trimming dividend payouts. Moody's vice-president David Beatie says, "Dividend cuts would be a last resort." He says other measures to preserve capital would include stopping share buyback programs and issuing new shares. The banks could also take steps to reduce risk-weighted assets by not replacing securities in their portfolios when they mature, and adjusting pricing to attract less new business in their loan books. At the moment, Canadian Imperial Bank of Commerce and Bank of Nova Scotia would have the highest estimated losses in terms of CET1 capital under extreme oil and gas stress, says Mr. Beatie. The actual outcome, he says, would depend on if and when low oil prices and their fallout lead to the conditions in the severe stress scenario.