The Bank of England is set to warn of the dangers facing the financial system following the Brexit vote as it steps up oversight of the country’s biggest lenders.
In the latest sign that Threadneedle Street is preparing for a sharp economic downturn, the governor, Mark Carney, is expected to outline measures to encourage banks to lend. Capital buffer requirements may be loosened as part of the battle to contain the referendum fallout.
“Carney may tell us that we can take a break from raising as much capital,” said a senior source in one of the largest banks. “If he does, this would be the clearest sign that we are heading for a recession.”
The governor’s warning — to be delivered in the Bank’s twice-yearly
