Laura WilesThe BoE has set out key elements of its 2025 stress test of UK central counterparties (CCPs), and published a spreadsheet containing risk factor shocks for each market stress scenario.
This year’s test will focus on assessing the resilience of UK CCPs to the default of two or more of its members during a severe market stress, including a core credit stress test and additional reverse stress and sensitivity testing to explore how the results change under increasingly severe assumptions. The exercise will not include a full liquidity stress test, but will explore liquidity risks in a qualitative manner to assess how risks have developed since firms were last tested.
The BoE intends to publish its findings from the exercise in Q4 2025.