BoE official reveals details of non-bank backstop design

Bank intends to activate mechanism in crises only, despite firms’ call for standing liquidity facility

Bank of England
Daniel Hinge

A Bank of England (BoE) official has revealed more details of how it plans to create an emergency liquidity facility for non-banks.

Nick Butt, head of the bank’s future balance sheet unit, said firms responding to a consultation had argued in favour of a standing facility. However, he said the bank preferred to activate a facility only in times of crisis.

In remarks on March 12, Butt laid out other aspects of the facility’s likely design. These included narrow collateral eligibility, a limited set

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