New BoE webpage on 2021 bank stress test
Industry News | 20/01/21
The Bank of England (BoE) published a new webpage on the key elements of the 2021 bank stress test. The 2021 solvency stress test will measure the major UK banks and building societies against a UK and global scenario that reflects a severe path for the current macroeconomic outlook. Unless otherwise agreed, the reference date will be 31 December 2020, and will cover a five-year horizon.
The timetable for the 2021 solvency stress test will be staggered. Results of the 2021 solvency stress test will act as a cross-check on the Financial Policy Committee’s (FPC’s) judgement of how severe the current stress would need to be in order to jeopardise banks’ resilience and challenge their ability to absorb losses and continue to lend. It will also support the Prudential Regulation Authority’s (PRA’s) objective of promoting the safety and soundness of PRA-regulated firms.