BoE may impose capital floors on UK firms – PRA chief

Sam Woods
Sam Woods, Prudential Regulation Authority
Bank of England

The Bank of England may need to intervene in firms’ modelling choices, as large UK mortgage lenders increase risk and cut their internally determined capital requirements, Sam Woods said today (May 24).

The Prudential Regulation Authority chief executive said firms had responded to a “price war” in the mortgage market by moving up the “risk curve” to compensate for squeezed interest margins.

At the same time, large firms using internal models have significantly trimmed the risk weights on

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