The Bank of England (BoE) Financial Policy Committee concluded at its last meeting on November 15 that uncertainty around the economic outlook and risks affecting it have increased, according to minutes published on Friday. "As the UK is an open economy with a large financial sector, these risks are particularly relevant to UK financial stability," the committee said, citing geopolitical tensions, global fragmentation and pressures on sovereign debt levels as the most pertinent issues.
The BoE found that household and corporate borrowers are "likely to remain resilient in aggregate" as the banking system is able to support them "even if economic, financial and business conditions were to be substantially worse than expected." The central bank said it will perform its main bank capital stress test once every two years compared to every year previously, which will "create space to assess and address a wider range of risks in an evolving risk environment."
