BoE Eases Capital Requirements for UK Banks to Stimulate Lending
The Bank of England has cut capital requirements for UK banks from 14% to 13% of risk-weighted assets—the first reduction since post-2008 crisis reforms. This regulatory easing aims to boost business and household lending capacity while raising concerns about renewed financial sector risks.
Lord Prem Sikka warned the MOVE could incentivize excessive risk-taking: 'Banks will do more gambling to boost profits. Public purse will bear the cost of bailouts.' The decision reflects ongoing tension between economic stimulus and financial stability safeguards.