KPMG comments on the Bank of England's latest Financial Stability Report
Responding to today’s Financial Stability Report from the Bank of England, Karim Haji, Head of Financial Services, KPMG UK & EMEA said:
Responding to today’s Financial Stability Report from the Bank of England, Karim Haji, Hea
Responding to today’s Financial Stability Report from the Bank of England, Karim Haji, Head of Financial Services, KPMG UK & EMEA, said:
“The UK’s finance sector is big, complex, interconnected and critical, every part of it has to be resilient in order to best support our economy and consumers. Today’s findings show that while UK banks are well positioned to manage the worsening economic outlook, urgent work is needed to ensure the wider non-bank sector is equally as robust.
“Building on previous financial stability reports, it is most telling that this iteration again highlights the Bank’s concerns regarding the non-bank sector and announces that, for the first time, it will run an exploratory stress test focusing on this segment of the market. Specifically on LDI, the Bank has been explicit about what it wants regulators to do, that is, set steady-state minimum levels in the LDI market, which will likely translate into minimum liquidity buffers. I expect to see quick progress on this.
“Not surprisingly cryptoassets also feature prominently. The FPC, although not concerned with the impact on financial stability yet, sees the need for enhanced regulatory oversight of crypto markets and activity given the speed of developments in the area.”
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