Market news
25.09.2017, 08:39

Bank of England FPC - Brexit poses risks to continuity of derivative and insurance contracts

  • Increased risk reflects deteriorating loan quality, tougher stress test including 4 pct BOE bank rate

  • Average loss rate of 20 pct for UK consumer lending in 2017 compares with 13 pct in 2016

  • Banks should factor these expected loss rates into future capital plans

  • Still expect to raise counter-cyclical capital buffer to 1 pct from 0.5 pct at nov meeting, with effect from nov 2018

  • New ifrs9 accounting rule will not lead to increased capital requirements for banks

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