UK Banks face stress test results



It’s the moment of truth for the UK's biggest financial institutions as later today the Bank of England will publish the results of its bank stress test, otherwise known as annual cyclical scenario (ACS). By using the test to determine how much capital UK banks could need in such a scenario, the Bank aims to ensure they are able to continue to lend to households and businesses in bad times as well as good.

Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland, and Santander UK all took part in the 2019 test, which contains three types of severe stress which are assumed to be synchronized:

• A UK and global macroeconomic stress, spanning a five-year period to the end of 2023

• A traded risk stress, linked to a financial market scenario consistent with the content and calibration of the macroeconomic stress

• A misconduct costs stress

FTSE 100 opened at 7317.15 quickly rising above 7430, while GBP/USD gained 0.23% at 11:00 GMT, ahead of the Financial Stability Report scheduled at 16:00 GMT.

Stay tuned to Capex’s news section for more information and the latest updates!


Sources: bankofengland.co.uk, moodysanalitics.com, reuters.com

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