Market News
Bank of England consults on exempting more small lenders from leverage rule - REUTERS
LONDON, March 5 (Reuters) - The Bank of England's Prudential Regulation Authority (PRA) is consulting on raising the retail deposits leverage ratio threshold, a move designed to allow smaller lenders to avoid the leverage rules which cover the country's major banks.
The ratio is aimed at indicating what level of capital Britain's major banks, building societies and investment firms should have to fund their activities.
The threshold at which it applies has been fixed in cash terms since 2016, meaning smaller firms have been dragged into the regime as inflation and the size of the economy has risen.
The Bank of England said on Wednesday that the PRA will consult on raising the retail deposits leverage ratio threshold by 20 billion pounds ($25.7 billion) to 70 billion pounds, to reflect nominal GDP growth over the last nine years.
