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Bank of England says UK faces 'challenging period' for financial stability 

September 22, 2016

David Milliken & Huw Jones, Reuters

Britain still faces a "challenging period" for financial stability despite resilience seen after the European Union referendum, and rules for banks must remain tight, the Bank of England said on Thursday.

Britain's government is keen to ensure London retains its place as Europe's leading financial centre even after the country leaves the EU, but the BoE said there was no case to loosen bank capital rules.

"Although financial stability has been maintained in the United Kingdom through a period of volatility ... the United Kingdom faces a challenging period of uncertainty and adjustment," the BoE's Financial Policy Committee said in a quarterly statement.

With UK-regulated banks' future access to EU markets unclear, Britain's government is likely to come under pressure from the industry to make London a more attractive location.

The Confederation of British Industry has already called for banks to be removed from the "naughty step", after a prolonged regulatory crackdown following the financial crisis. Read more


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