Set to close on 11 December, the consultation titled the Financial Services Bill: the Financial Policy Committee’s Macro prudential tools aims to establish which levers the new regulator should pull to avoid a further financial crisis.
Plans to establish the FPC within the Bank of England as a macro-prudential authority is key to the Government’s reforms to the UK’s system of financial regulation, which will be enacted by the Financial Services Bill.
Industry responses are being sought on the case for making the FPC responsible for setting ‘counter-cyclical capital buffers’ and capital requirements for different product types.
The measures will be implemented in line with Basel III and CRD4 and no earlier than 2018.
For the paper, click HERE
In June, the International Monetary Fund (IMF) became the latest industry lobbyist to add its voice to the argument to hand the Bank of England the power to cap loan to value (LTV) ratios.
In its latest report on the UK economy the IMF said that the Bank of England’s Financial Policy Committee (FPC) should be given power to cap LTV levels in order to prevent property price bubbles.
