LONDON (UK) – With Britain struggling to contain the pandemic, the Bank of England took action on Friday to ensure that financial establishments keep lending through 2021. It said it was ready to deal with any disruption in the market from a change in the country’s trading relationship with the EU.
BoE Governor Andrew Bailey said the country had done all it can to bring down the risks posed by a no-deal exit from the bloc on Dec. 31, adding that it was ready to tackle any disruptions to financial markets.
“What has the Bank of England got in its armoury, as it were? The answer is a lot. We will use our tools, as we did in March, should we be in that situation,” Bailey said in a press briefing.
He said that disruptions in the market would not pose a threat to financial stability. But he warned some EU customers might not be able to access to financial services in Britain as the bloc has not taken mitigating action.
“There is a limit to what we can do,” Bailey said.
According to the BoE, market volatility could be reinforced by some derivative users not being fully ready to trade with EU counterparties or on EU or EU-recognised trading venues.
“Financial institutions should continue taking measures to minimise disruption,” it said.
