Most UK banks pass stress tests
The Bank of England has revealed seven out of the eight biggest high street lenders passed its rigorous stress test.
Almost all the UK's main high street banks have passed the Bank of England stress tests, indicating they could keep on functioning fully even in a dire economic crisis.
The Bank's December Financial Stability Report indicated that five of the institutions - HSBC, Barclays, Santander, Standard Chartered and Nationwide - passed comfortably. The position was less clear-cut at Lloyds and the Royal Bank of Scotland (RBS), both of which only passed by a small margin. The Co-operative Bank was the one institution to fail.
With future stress tests to be applied to issues outside the scope of the current regime - like the risks from overseas markets - banks may need to take on more auditors to make sure they continue to pass stress tests.
The Co-operative Bank, which is currently working through its own detailed recovery plan, said it was not surprised that it did not pass the test at this stage, as it will take time to resolve balance sheet problems.
Speaking to the BBC, the man behind the tests, Andrew Bailey, said it would not be necessary for Lloyds or RBS to take fresh remedial measures.
He said: "We have to bear in mind the major tasks that both banks have had to rebuild their capital positions and their resilience from the depths of the crisis."
The checks carried out by the Bank of England were very rigorous, as the scenario against which the banks were being tested included a series of dire circumstances coming together all at once, such as unemployment reaching 12 per cent, house prices falling by 35 per cent and consumer prices index inflation soaring to 6.6 per cent, all situations that would be worse than anything that has happened since 2007.
As a result, the chances of the banks that encountered difficulties in meeting the requirements actually struggling to remain in business are fairly remote.
One reason for this is that even if there is a major economic downturn in a few years hence, by then the remedial action being taken by banks will have had more chance to take effect, thus ensuring they are in a more robust position.
Signup to receive the latest discipline specific articles
Related articles
Teaser
GovernanceContent Type
Fintech
18/04/24
Summary
The role of risk and compliance in financial services As a sizeable, growing portion of the financial services sector, risk and compliance play a vital role in ensuring that firms conduct busine
by
David Clamp
Teaser
Executive SearchContent Type
General
18/04/24
Summary
Private equity (PE) is a growing industry that has always attracted ambitious top talent due to its high risk/high gain capital investment. Pre-covid, we saw the global private equity industry b
by
Tracey Alper
Teaser
Commerce & IndustryContent Type
General
18/04/24
Summary
What is financial contracting? Financial contracting refers to the practice of hiring finance professionals on a contractual basis to fulfil specific roles or projects within an orga
by
Kelvin Murphy
Related jobs
Salary:
Negotiable
Location:
London
Industry
Energy, Resources and Industrial
Qualification
Fully qualified
Market
Commerce & Industry
Salary
£80,000 - £100,000
Job Discipline
Qualified Finance
Contract Type:
Permanent
Description
A high growth, renewable energy business based in Central London is currently seeking a new Management Accountant to join the team.
Reference
HAS3344210
Expiry Date
01/01/01
Author
Hannah SpearsAuthor
Hannah SpearsSalary:
£30 - £32 per hour
Location:
Stevenage, Hertfordshire
Industry
Manufacturing
Qualification
None specified
Market
Commerce & Industry
Salary
£250 - £350
Job Discipline
Project & Programme Management
Contract Type:
Permanent
Description
Manufacturing Project Manager for our Defense and Space Manufacturing Client.
Reference
BBBH180032
Expiry Date
01/01/01
Author
Joshua MasseyAuthor
Joshua MasseySalary:
Up to £27,000 per annum
Location:
Bristol
Industry
Insurance
Qualification
None specified
Market
Commerce & Industry
Salary
£25,000 - £30,000
Job Discipline
Part Qualified & Transactional Finance
Contract Type:
Contract
Description
Finance Assistant. This is a 12-month part-time (C.22 hours) FTC with a potential opportunity to go permanent. 27k pro rata
Reference
BBBH180026
Expiry Date
01/01/01
Author
Ali ArslanAuthor
Ali ArslanSalary:
£40,000 - £50,000 per annum + Strong Bonus & Benefits
Location:
London
Industry
Business Services
Qualification
None specified
Market
Professional Services
Salary
£50,000 - £60,000
Job Discipline
Project & Programme Management
Contract Type:
Permanent
Description
Role within High-Growth Specialist Consultancy as they build out their Commercial Change & Transformation offering
Reference
BBBH179934
Expiry Date
01/01/01
Author
Henry TownsendAuthor
Henry TownsendSalary:
£40,000 - £55,000 per annum
Location:
West Yorkshire
Industry
Business Services
Qualification
Finalist / Newly qualified
Market
Commerce & Industry
Salary
£50,000 - £60,000
Job Discipline
Internal Audit
Contract Type:
Permanent
Description
Marks Sattin are currently working with a leading PLC who are recruiting for a Senior Internal Auditor to join the team.
Reference
BBBH180007
Expiry Date
01/01/01
Author
Rajveer SanghaAuthor
Rajveer SanghaSalary:
£28,000 - £30,000 per annum
Location:
Leeds, West Yorkshire
Industry
Business Services
Qualification
None specified
Market
Commerce & Industry
Salary
£30,000 - £35,000
Job Discipline
Part Qualified & Transactional Finance
Contract Type:
Permanent
Description
Credit Controller role in Leeds - Middle East/Asia Ledgers
Reference
BBBH179367
Expiry Date
01/01/01
Author
Cameron WalshAuthor
Cameron WalshSalary:
Negotiable
Location:
London
Industry
Media & Communications
Qualification
Part qualified
Market
Commerce & Industry
Salary
£30,000 - £35,000
Job Discipline
Part Qualified & Transactional Finance
Contract Type:
Permanent
Description
An international events company, specialising in the sports, betting and gaming industry, are seeking a Finance Assistant.
Reference
KD0606
Expiry Date
01/01/01
Author
Kimberley DonovanAuthor
Kimberley DonovanSalary:
£32,000 - £37,000 per annum + Study support & Bonus
Location:
Leeds, West Yorkshire
Industry
Manufacturing
Qualification
Part qualified
Market
Commerce & Industry
Salary
£35,000 - £40,000
Job Discipline
Part Qualified & Transactional Finance
Contract Type:
Permanent
Description
Really excited to be partnering with a market leader in their field to support them recruit an Assistant Financial Accountant to join their team.
Reference
179873
Expiry Date
01/01/01
Author
Laura GunbyAuthor
Laura GunbySalary:
£40,000 - £60,000 per annum
Location:
West London, London
Industry
Energy, Resources and Industrial
Qualification
None specified
Market
Commerce & Industry
Salary
£60,000 - £70,000
Job Discipline
Part Qualified & Transactional Finance
Contract Type:
Contract
Description
Temporary to permanent Payroll Manager
Reference
BBBH180023
Expiry Date
01/01/01
Author
Chelsea MillsAuthor
Chelsea MillsSalary:
£50,000 - £65,000 per annum
Location:
Leeds, West Yorkshire
Industry
Business Services
Qualification
Fully qualified
Market
Commerce & Industry
Salary
£60,000 - £70,000
Job Discipline
Internal Audit
Contract Type:
Permanent
Description
A great business keen to recruit for an Internal Audit Manager to come onboard and join the team.
Reference
BBBH180005
Expiry Date
01/01/01
Author
Rajveer SanghaAuthor
Rajveer Sangha