UK banks 'too weak' to survive another recession

Speaking to BBC Radio 4 on Monday, King criticised current measures being taken by the BoE to stabilise the economy, including keeping interest rates at a record low – currently at 0.5 percent – for more than five years.

UK banks 'too weak' to survive another recession 436435735.si

UK banks 'too weak' to survive another recession 436435735.si

"I don't think we're yet at the point where we can be confident that the banking system would be entirely safe," he told the programme.

“The idea that we can go on indefinitely with very low interest rates doesn't make much sense," he added.

However, King also warned that a sudden increase in interest rates could provide too much of a shock to the British economy, which is only beginning to recover after the global financial crisis in 2008.
King was head of the BoE’s monetary policy department from 2003-13, and was in charge of setting Britain’s interest rates and controlling its money supply.

“It was exciting and it was fascinating and it was the sort of problem that we had trained to deal with over many years” he told the BBC.

“So I think both Ben [Bernanke] and I felt that having spent a good deal of time thinking through the intellectual foundations of what to do with a banking crisis and the opportunity to deal with one was one that we were well prepared for.”

http://rt.com/uk/218491-uk-bank-england-crash/
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UK banks 'too weak' to survive another recession

UK banks 'too weak' to survive another recession

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