Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Bank of England says bank buffer may need reworking to handle crises

Published 10/15/2020, 09:38 AM
Updated 10/15/2020, 09:40 AM
© Reuters. FILE PHOTO: The Bank of England in London, Britain

LONDON (Reuters) - The design of bank buffers may need changing to encourage lenders to tap their capital and avoid a credit crunch in the economy, the Bank of England's Deputy Governor Jon Cunliffe said on Thursday.

Even though regulators have given banks the green light to dip into buffers to help businesses survive the COVID-19 hit to the economy, there was a "first mover disadvantage" to doing so as it could limit dividends and other payouts, Cunliffe said.

"We will need to think through this question more as the recovery - albeit a bumpy one - gathers pace, as impairments mount and it becomes clearer how permanent the damage will be," Cunliffe told an online event hosted by the Washington-based Peterson Institute for International Economics.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.