BoE tightens countercyclical buffer as risks stabilise

Banks expected to meet higher rate without cutting lending, even as capital ratios dip

bank of england - clock - Getty.jpg

The Bank of England has raised its countercyclical capital buffer (CCyB), as policy-makers say risks have returned to a “standard” level after the impact of the Covid-19 pandemic.

The BoE’s financial policy committee set the buffer rate at 1% today (December 13), up from 0%. Banks will have until December 2022 to meet the new rate.

The FPC added that it expected to raise the CCyB to 2% in the second quarter of 2022, provided the economy evolves in line with the BoE’s forecasts.

“Before the

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