Former Bank of England officials criticize capital requirement cut as risk to stability
Two former Bank of England officials argue that reducing bank capital requirements will enrich shareholders and increase risks while failing to boost lending.
Insights:
In December 2025, the Bank of England's Financial Policy Committee decided to lower the system-wide Tier 1 capital requirement from 14% to 13% of risk-weighted assets. Governor Andrew Bailey andrew baileystated at the time that the central bank hoped the commercial banking sector would increase lending to support economic growth across the United Kingdom 
GB. This significant regulatory shift reverses several post-financial-crisis frameworks designed to ensure banks maintain a substantial buffer against potential losses.
GB. This significant regulatory shift reverses several post-financial-crisis frameworks designed to ensure banks maintain a substantial buffer against potential losses.
