London Daily

Focus on the big picture.
Tuesday, Aug 05, 2025

UK financial system strong enough to withstand even cataclysmic recession

UK financial system strong enough to withstand even cataclysmic recession

The Bank of England has delivered its verdict after carrying out its annual stress tests on Britain's major banks.

Britain's financial system is healthy enough to withstand even a cataclysmic recession, the Bank of England has said, following its annual set of stress tests on the country's major banks.

The Bank said that even if there were a recession involving a rise in the unemployment rate to 12% and a house price crash of 33%, UK banks would not see their levels of capital drop to dangerous levels.

Talking of the Bank's stress tests, designed to check the health of Britain's lenders in the face of a simulated crisis, the governor, Andrew Bailey, said: "We didn't have the Omicron variant to hand when we built the stress test but the question the stress test sought to answer is highly relevant to it.

Andrew Bailey said the stress tests produced a 'solid result'


"The system can withstand a stress that's much larger than the stress we've seen so far [during the pandemic].

"That is a solid result, and you can read that into Omicron."

All eight of the major banks passed the Bank of England's stress tests.

The Bank said it would raise the capital requirements for UK banks - a metric of the strength of their balance sheets - next year.

The analysis pre-dates the onset of the Omicron variant in the country but comes amid concerns that in the face of the new variant, UK economic activity may dip in the coming months.

The Bank also warned that it was monitoring the rise in use and popularity of cryptocurrencies.

The Bank's report pre-dates the onset of the Omicron variant


The Financial Policy Committee said that "direct risks to the stability of the UK financial system from cryptoassets are currently limited".

"However, at the current rapid pace of growth, and as these assets become more interconnected with the wider financial system, cryptoassets will present a number of financial stability risks," it added.

The Bank announced that it was planning to consult on withdrawing its mortgage affordability tests - tests which have made it tougher for many prospective homebuyers to get on to the housing ladder - but that this would potentially not happen until next year.

Comments

mike 4 year ago
The banks test is part of disney world

Newsletter

Related Articles

0:00
0:00
Close
Elon Musk Receives $23.7 Billion Tesla Stock Award
Texas House Paralyzed After Democrats Walk Out Over Redistricting
Mexican Cartels Complicate Sheinbaum’s U.S. Security Talks
Mark Zuckerberg Declares War on the iPhone
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
OpenAI’s Bold Bet: Teaching AI to Think, Not Just Chat
Tesla Seeks Shareholder Approval for $29 Billion Compensation Package for Elon Musk
Nvidia is cutting prices on its RTX 50-series graphics cards after sales slowed and inventories piled up
Ghislaine Maxwell Transferred to Minimum-Security Prison Amid Ongoing DOJ Discussions
U.S. Tariffs Surge to Highest Levels in Nearly a Century Under Second Trump Term
Matt Taibbi Slams Media for Role in Russiagate Narrative
Pilots Call for Mental Health Support Without Stigma
All Five Trapped Miners Found Dead After El Teniente Mine Collapse
Ong Beng Seng Pleads Guilty in Corruption Case Linked to Former Singapore Transport Minister
BP’s Largest Oil and Gas Find in 25 Years Uncovered Offshore Brazil
Italy Fines Shein One Million Euros for Misleading Sustainability Claims
JPMorgan and Coinbase Unveil Partnership to Let Chase Cardholders Buy Crypto Directly
Declassified Annex Links Soros‑Affiliated Officials and Clinton Campaign to ‘Russiagate’ Narrative
UK's Online Safety Law: A Front for Censorship
Nationwide Protests Erupt in Brazil Demanding Presidential Resignation
Parents Abandon Child at Barcelona Airport Over Passport Issue
Mystery Surrounds Death of Brazilian Woman with iPhones Glued to Her Body
Bus Driver Discovers Toddler Hidden in Suitcase in New Zealand
Switzerland Celebrates 734 Years of Independence Amid Global Changes
U.S. Opens Official Investigation into Former Trump Prosecutor Jack Smith
Leaked audio of Canada's new PM Mark Carney admitting the truth about the Net Zero agenda: "We're gonna make a lot of money off of this."
China Enforces Comprehensive Ban on Cryptocurrency Activities
Absolutely 100% Realistic EVO Series Doll by EXDOLL (Chinese Company) used mainly for carnal purposes
World Economic Forum founder Klaus Schwab: "In this new world, we must accept... total transparency. You have to get used to it. You have to behave accordingly. But if you have nothing to hide, you shouldn't be afraid."
Meet Mufti Hamid Patel, head of Office for Standards in Education in Pakistan
George Soros tells the World Economic Forum: "President Trump is a con man and the ultimate narcissist, who wants the world to revolve around him."
Hamas are STARVING the hostages.
Decline in Tourism in Majorca Amidst Ongoing Anti-Tourism Protests
British Tourist Dies Following Hair Transplant in Turkey, Police Investigate
Poland Begins Excavation at Dziemiany After New Clue to World War II‑Era Nazi Treasure
WhatsApp Users Targeted in New Scam Involving Account Takeovers
Trump Threatens Canada with Tariffs Over Palestinian State Recognition
Trump Deploys Nuclear Submarines After Threats from Former Russian President Medvedev
Trump Sues Murdoch in “Heavyweight Bout”: Lawsuit Over Alleged Epstein Letter Sets Stage for Courtroom Showdown
Germany Enters Fiscal Crisis as Cabinet Approves €174 Billion in New Debt
Trump Administration Finalizes Broad Tariff Increases on Global Trade Partners
J.K. Rowling Limits Public Engagements Citing Safety Fears
JD.com Launches €2.2 Billion Bid for German Electronics Retailer Ceconomy
Azerbaijan Proceeds with Plan to Legalise Casinos on Artificial Islands
Former Judge Charged After Drunk Driving Crash Kills Comedian in Brazil
Jeff Bezos hasn’t paid a dollar in taxes for decades. He makes billions and pays $0 in taxes, LEGALLY
China Increases Use of Exit Bans Amid Rising U.S. Tensions
×