Bank of England to toughen scrutiny of risks from home loans


© Reuters. A row of houses are seen in London

LONDON (Reuters) – The Bank of England has set out proposals on tackling “inappropriately” low risk-weightings on home loans, used for determining how much capital banks must hold.

“For those firms whose risk weights may increase as a result of these proposals, and where capital requirements are not already determined by other capital measures (e.g. leverage), there would be costs for the firm associated with the additional capital required,” the BoE said in a statement.

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