United Kingdom: Financial Sector Assessment Program-Review of the Bank of England’s Liquidity Provision Framework-Technical Note

June 17, 2016

Preview Citation

Format: Chicago

United Kingdom: Financial Sector Assessment Program-Review of the Bank of England’s Liquidity Provision Framework-Technical Note, (USA: International Monetary Fund, 2016) accessed November 21, 2024

Summary

This paper provides a review of the liquidity provision framework and recent developments in the United Kingdom. The Bank of England’s (BoE’s) Sterling Monetary Framework is the mechanism used in the United Kingdom to direct liquidity provision. The BoE’s relatively wide-ranging and accessible liquidity insurance framework raises three key questions and four other issues relevant to financial stability. The quantification of implications of the liquidity framework for the BoE balance sheet is still a work in progress. Safeguards are generally sufficient, although the BoE should ensure that lower level of supervisory scrutiny directed at small- and medium-sized enterprises does not adversely impact its horizon-scanning for firms at risk of requiring liquidity support.

Subject: Asset and liability management, Banking, Financial crises, Financial institutions, Financial regulation and supervision, Foreign currency liquidity, Insurance, Lender of last resort, Liquidity, Liquidity risk

Keywords: Bank., BoE base rate, BoE sterilization operation, Central bank, CR, ELA, ELA framework, Foreign currency liquidity, Global, Horizon-scanning function, Insurance, ISCR, Lender of last resort, Liquidity, Liquidity insurance framework, Liquidity risk, Swap line

Publication Details

Pages:

25
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2016/159
Stock No:

1GBREA2016007
ISBN:

9781475559446
ISSN:

1934-7685

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