BoE Gives Cautious Thumbs Up to Major UK Banks’ Crisis Readiness

The Bank of England (BoE) has conducted its second “resolvability” assessment of Britain’s eight largest banks, concluding that these institutions could be safely wound down in a crisis without immediate need for taxpayer funds. 

This evaluation, announced on Tuesday, is a crucial measure implemented following lessons learned from the 2007-09 global financial crisis.

The assessment covered major banks including HSBC (LON: HSBA), Barclays (LON: BARC), Lloyds (LON: LLOY), NatWest (LON: NWG), Santander UK (LON: BNC), Standard Chartered (LON: STAN), Virgin Money UK (LON: VMUK), and Nationwide. While some “shortcomings” and areas for “further enhancement” were identified, none were deemed severe enough to impede the resolution process in a crisis scenario.

Standard Chartered was singled out as the only bank with a specific “shortcoming” related to its restructuring planning capabilities. The BoE expects this issue to be addressed and will monitor progress closely. Four other banks — Barclays, HSBC, Lloyds, and Virgin Money — were advised to enhance certain aspects of their plans. Nationwide, NatWest, and Santander UK emerged without material issues.

The BoE’s Deputy Governor, Dave Ramsden, emphasized that resolvability is an ongoing process with continual lessons to be learned. In light of recent events in the global banking sector, such as the UBS takeover of Credit Suisse and the resolution of Silicon Valley Bank’s UK subsidiary, the BoE stressed the importance of maintaining credible resolution frameworks for systemic banks.

Given the “significant progress” observed since the first assessment, the BoE has decided to postpone the next evaluation by one year to 2026-27.


Information for this story was found via Reuters, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

200 Grams of Gold And 21% Copper — That’s Not Normal | Matt Wilson – Sterling Metals

Silver at $100? This Time It Might Stay There. | David Morgan

Critical Minerals Are Rerating! | John Passalacqua – First Phosphate

Recommended

Steadright Enters MOU To Acquire Historic Goundafa Polymetallic Mine In Morocco

Military Seizes Power in Madagascar After President Flees

Related News

Bank of England Hikes 75 Basis Points, Economy Expected to Fall Into Longest Recession on Record

The Bank of England delivered one of the largest rate hikes in 33 years on...

Thursday, November 3, 2022, 10:12:55 AM

Gold Rush to US Puts Squeeze on Bank of England

The Bank of England faces mounting pressure as unprecedented demands to withdraw gold have stretched...

Thursday, January 30, 2025, 07:30:34 AM

Tether Could Teeter On UK Govt’s Tighter Hold On Stablecoin Regulation

Stablecoin issuers like Tether are about to face a tighter regulatory leash as the Bank...

Tuesday, November 7, 2023, 09:44:20 AM

UK’s Stubborn Inflation Fuels Expectations for More BoE Rate Hikes

UK’s inflation rate, which was expected to fall more significantly, dropped marginally to 8.7% in...

Wednesday, May 24, 2023, 01:37:20 PM

Bank of England Embarks on Second Bond-Buying Spree, Warns UK’s Financial Stability Faces ‘Material Risk’

The Bank of England was forced to intervene in UK financial markets once again, as...

Wednesday, October 12, 2022, 12:18:00 PM