Sam Woods will step down from his role at the PRA in June 2026.

The head of the UK’s banking watchdog has warned of high risk if the UK loosens its rules around lenders’ capital framework as the government pushes for economic growth.

Sam Woods, the head of the Prudential Regulation Authority (PRA), said requiring banks to no longer set aside capital for top-tier sovereign bonds would “be equivalent to ripping off our jacket, warm hat and gloves and throwing them all over the nearest cliff”.

A bank’s leverage ratio measures the stability of a firm through dividing its core capital by unweighted assets such as loans and bonds.

Should the bonds – often considered lower-risk – be removed from the calculation, it would require banks to hold fewer funds to cover its assets.

In a speech

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