"We are well-prepared for this": Bank of England Governor Mark Carney's post-Brexit reassurance

“The Bank has put in place extensive contingency plans.” 

Sign Up

Get the New Statesman's Morning Call email.

The Governer of the Bank of England Mark Carney has made a statement to calm market fears, following Britain's vote for Brexit.

He said:

“The people of the United Kingdom have voted to leave the European Union. Inevitably, there will be a period of uncertainty and adjustment following this result. But as the Prime Minister said just this morning, there’ll be no initial change in the way our people can travel, and the way our goods can move, or the way our services can be solved. And it will take some time for the United Kingdom to establish new relationships with Europe and the rest of the world. So some market and economic volatility can be expected as this process unfolds.

“But we are well-prepared for this. Her Majesty’s Treasury and the Bank of England have engaged in extensive contingency planning, and the Chancellor and I have remained in close contact, including through the night and this morning. To be clear, the Bank of England will not hesitate to take additional measures as required, as markets adjust, and as the UK economy moves forward.

“Those economic adjustments will be supported by a resilient UK financial system, one that the Bank of England has consistently strengthened over the course of the last seven years. The capital requirements of our largest banks are now ten times higher than before the financial crisis. And the Bank of England has stress-tested those banks against scenarios far more severe than our country currently faces. As a result of these actions, UK banks have raised over 130bn in pounds of new capital, more than £600bn of high-quality, liquid assets. So why does this matter? Well, that substantial capital and huge liquidity gives banks the flexibility they need to continue to lend to UK businesses and households, even during challenging times . . .

“In the coming weeks, the Bank will assess economic conditions and we will consider any additional policy responses . . . The Bank has put in place extensive contingency plans.” 

Anoosh Chakelian is the New Statesman’s Britain editor.

Free trial CSS