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  • Bank of England Publishes Interim Financial Stability Report on Impact of COVID-19
    The Bank of England’s Financial Policy Committee and Monetary Policy Committee have published reports focusing on the impact of COVID-19 on the U.K. economy and banking sector, together with the minutes of their May Committee meetings and a transcript of the BoE’s joint FPC and MPC press conference, discussing the findings of the Committee reports.

    The FPC’s Interim Financial Stability Report provides an overview of the impact of COVID-19 on the U.K. financial system and offers a view of the outlook for the U.K.’s financial stability, based on data available as at April 29, 2020. The FPC is responsible for contributing to the financial stability of the U.K. economy by monitoring and removing systemic risks. The FPC’s report covers: (i) the recent performance of the U.K. financial system after the COVID-19 shock, and stresses the continued importance of the LIBOR transition; (ii) the resilience of the U.K. banking sector in the wake of COVID-19, based on a desktop stress test carried out by the FPC on the basis of the illustrative scenario set out by the MPC in its Monetary Policy Report; and (iii) the impact of COVID-19 on corporate sector financing.

    The MPC’s Monetary Policy Report is produced on a quarterly basis and provides information on the MPC’s thinking and reasoning for its decisions, in this case with particular reference to COVID-19. The MPC’s report is primarily concerned with the impact of COVID-19 on the U.K. economy.

    The minutes of the MPC and FPC meetings show the reasoning of each Committee for recent decisions taken by them. In particular, the FPC minutes note the reasons for the FPC’s support of recent actions taken by the U.K. Prudential Regulation Authority, including (i) the PRA’s offering of modifications by consent of the leverage ratio treatment of guaranteed lending for Government schemes (ii) the computation of exposure measures for the leverage ratio, and (iii) the maintenance of Systemic Risk Buffer rates for ring-fenced bodies at December 2019 levels until at least December 2021.  The minutes of the MPC’s meeting confirm, amongst other things, the MPC’s unanimous vote on May 6, 2020 to maintain the Bank Rate at 0.1%.

    View the FPC and MPC's Reports, minutes and transcript.

    Details of other regulatory responses to COVID-19 are available at our COVID-19 Research Center.

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