Bank of England to loosen post-financial crisis capital rules for banks

The Bank of England has cut its estimate for the level of capital reserves that banks must hold to protect against their collapse, in a significant loosening of post-financial crisis regulations.

The new capital requirements for banks will be lowered from about 14% to 13% of risk-weighted assets, under the Bank’s proposals.

This refers to the amount that banks must set aside as a buffer against risky lending and investments, to cushion against any losses.

The rules were introduced in the aftermath of the 2008 financial crisis to help prevent banks from excessive risk-taking and protect them from failure.

Our Financial Stability Report looks at the risks in our financial system and what we are doing to ensure households and businesses can rely on it.

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