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Business

BOE keeps UK banks on naughty step

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Opening sequence

Business

BOE keeps UK banks on naughty step

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COMING UP:BOE keeps UK banks on naughty step

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00:00:00
>> The UK may have weathered the initial Brexit storm but the outlook is still cloudy. That, at least, is the verdict of the Bank of England. It's financial policy committee setting out it's latest assessment Thursday. Reuters Senior UK Economics Correspondent David Milliken was listening in.>> It's concerned about, sort of, what might happen in terms of the broader economic outlook with the economy likely to slow, unemployment likely to rise, and wage growth slowing.
00:00:29
It's concerned about whether people will be able to keep repaying loans.>> The FBC's job is to head off risks to the country's huge financial services sector. Britain's big banks were hoping it might now lift a regulatory crackdown and make it easier for them to lend. With Brexit looming, they want help to make sure London keeps its leading role in global finance.
00:00:51
But the FPC says this is no time to remove the shackles.>> The Confederation of British industry has recently said that it's time to take British banks off, what it calls, the naughty step. After years of, sort of, increasing pressure, regulatory pressure on banks, following the financial crisis.
00:01:08
From the Bank of England's view, although, you wouldn't use a word like the naughty step, it is definitely not time to go easy on banks. It says that, essentially, there needs to be a lot of prudence and that the British financial system needs to be at least as resilient, if not more resilient than it has been in the recent past.
00:01:26
>> The Bank of England expects growth to more than half next year. That would be certain to hit banks, with any slowdown making people and businesses less likely to borrow. As with so much else in the UK, a lot hangs on exactly how BREXIT pans out.