BoE has published the FPC’s latest financial summary and record. Key points to note are:
- global growth is projected to rise in the medium term, although several risks to that outlook remain;
- improved transparency over valuation practices and overall levels of leverage would help to reduce vulnerabilities in the private equity sector. Risk management practices among lenders also need to improve and the FPC will consider the outcome of the FCA and PRA’s work to address these issues;
- banks need to factor system-wide trends into their liquidity management and forward planning;
- the decision to maintain the UK CCyB at 2%;
- given the significant progress made on liability-driven investment (LDI) fund resilience over the past 18 months, the FPC has closed its November 2022 and March 2023 Recommendations on LDI resilience; and
- the FPC welcomes the launch of the second round of the BoE’s system-wide exploratory scenario exercise.
BoE has also published its Financial Stability Report for 2024 which covers similar issues.